Who has the lowest mortgage rates? 24 top lenders, ranked

Maggie Overholt
The Mortgage Reports editor

Who has the lowest mortgage rates?

If you want to find the best mortgage rate, it helps to know where to start looking.

We analyzed data on every loan from the 24 biggest lenders in 2018 and 2019, looking for the lowest interest rates and fees.

These lenders topped the list for best 30-year mortgage rates:

  • USAA — Best mortgage rates and fees combined (military only)
  • Bank of America — Lowest average rate (bank)
  • Guaranteed Rate — Lowest average rate (non-bank)
  • PNC — Lowest average fees (bank)
  • Guaranteed Rate — Lowest average fees (non-bank)

But remember, rates vary a lot from person to person. There’s a good chance your best rate will come from a company not listed above.

Luckily, rates are near all-time lows right now. So it’s a good time to shop for your lowest offer.

Find and lock a low rate (Aug 15th, 2020)

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Finding your own lowest mortgage rate

Mortgage rates are highly individual, so the company with the lowest rates on average won’t be cheapest for everyone.

For example: Among the 24 biggest mortgage lenders, USAA had the lowest average mortgage rate in 2019, at just 3.98%.

But overall, USAA’s 30-year mortgage rates ranged from 2.875% to over 6%. So some people got much lower rates than others.

This list might give you some idea of where to start if you’re looking for the lowest mortgage rate and fees.

But to find your best offer, you have to request loan estimates from more than one company and compare. 

Check your mortgage rates (Aug 15th, 2020)

Average mortgage rates from top lenders

Mortgage Lender
Average 30-Year Mortgage Rate in 2019
USAA* 3.98%
Veteran’s United* 4%
Navy Federal CU* 4%
Bank of America 4.05%
Guaranteed Rate 4.12%
PNC 4.13%
Caliber Home Loans 4.15%
loanDepot 4.15%
Freedom Mortgage Corp. 4.15%
Guild Mortgage Co 4.15%
New American Funding 4.16%
Quicken/Rocket 4.16%
Finance of America Mortgage 4.21%
Chase 4.22%
Wells Fargo 4.22%
Movement Mortgage 4.24%
Stearns Lending 4.24%
Flagstar Bank 4.28%
HomeBridge Financial Services 4.28%
Academy Mortgage Corp 4.30%
Fairway Independent 4.33%
PrimeLending 4.36%
Mr. Cooper 4.44%
US Bank 4.66%

Average mortgage rates and fees shown here reflect the most recent HMDA data released in 2019.

The list of the top 24 biggest lenders is based on HMDA data from 2018. Your own interest rate and fees will vary. 

*These mortgage lenders only serve eligible veterans and service members

Which mortgage lender has the lowest closing costs?

Closing costs are around 2% to 5% of the loan amount on average. On a $200,000 loan, that’s $4,000 to $10,000 at the closing table. But just like mortgage rates, you can shop around for the lowest closing costs to minimize your out-of-pocket fees.

When you’re shopping, note that some closing can’t be negotiated, because they’re set by third parties (like appraisal and credit reporting fees).

But lenders do have wiggle room when it comes to setting other closing costs. So if you get multiple offers, you might have some leverage to negotiate your costs down.

>> Related: Average closing costs and how to keep yours low

Here’s how the top mortgage lenders stack up for total loan costs, according to 2019 data from HMDA.

Average loan costs from top lenders

Mortgage Lender
Average Loan Costs in 2019 (% of Loan Amount)
Example: Costs for a $250,000 Loan
PNC 0.88% $2,205
Chase 1.01% $2,531
Wells Fargo 1.10% $2,752
Guaranteed Rate 1.25% $3,133
Bank of America 1.26% $3,153
Veteran’s United 1.47% $3,667
Finance of America Mortgage 1.50% $3,751
Flagstar Bank 1.52% $3,794
US Bank 1.53% $3,823
Fairway Independent 1.55% $3,871
USAA 1.57% $3,913
Caliber Home Loans 1.65% $4,128
HomeBridge Financial Services 1.70% $4,257
Navy Federal CU 1.71% $4,285
loanDepot 1.72% $4,304
Stearns Lending 1.79% $4,487
Movement Mortgage 1.80% $4,490
PrimeLending 1.81% $4,517
New American Funding 1.84% $4,593
Freedom Mortgage Corp. 1.93% $4,830
Quicken/Rocket 2.00% $5,008
Guild Mortgage Co 2.05% $5,124
Academy Mortgage Corp 2.15% $5,368
Mr. Cooper 2.30% $5,745

The best mortgage rates and fees combined

It’s just as important to upfront compare loan costs as it is to compare mortgage rates.

Your interest rate might seem much more important, since it’s with you for the life of the loan.

But upfront fees can make a big difference — especially if you’ll only be in the house a few years.

Take a look at how the top mortgage lenders rank when you look at upfront fees plus interest, versus interest rate alone.

*() or () indicates how a company’s ranking changes when comparing its rates alone to its rates and fees combined.

Lender Average Interest Rate Lender Cost of Interest + Fees Over 7 Years
USAA 3.98% USAA $68,978
Veteran’s United 4% Veteran’s United $69,073
Navy Federal CU 4% Bank of America () $69,412
Bank of America 4.05% Navy Federal CU () $69,691
Guaranteed Rate 4.12% PNC () $69,831
PNC 4.13% Guaranteed Rate () $70,587
loanDepot 4.15% Chase () $71,697
Caliber Home Loans 4.15% Wells Fargo () $71,918
Freedom Mortgage Corp. 4.15% Caliber Home Loans () $72,096
Guild Mortgage Co 4.15% loanDepot () $72,272
Quicken/Rocket 4.16% New American Funding () $72,732
New American Funding 4.16% Finance of America Mortgage () $72,746
Finance of America Mortgage 4.21% Freedom Mortgage Corp. () $72,798
Chase 4.22% Guild Mortgage Co () $73,092
Wells Fargo 4.22% Quicken/Rocket () $73,147
Movement Mortgage 4.24% Flagstar Bank () $73,988
Stearns Lending 4.24% Stearns Lending $73,995
Flagstar Bank 4.28% Movement Mortgage () $73,998
HomeBridge Financial Services 4.28% HomeBridge Financial Services $74,451
Academy Mortgage Corp 4.30% Fairway Independent () $74,921
Fairway Independent 4.33% Academy Mortgage Corp () $75,904
PrimeLending 4.36% PrimeLending $76,082
Mr. Cooper 4.44% Mr. Cooper $78,684
US Bank 4.66% US Bank $80,546

Remember that most people who get a 30-year mortgage don’t keep their loan the full 30 years. In fact, homeowners keep 30-year loans for just 7 years on average.

When you’re only paying interest over a short period, those upfront fees start to carry more weight compared to your interest rate.

In addition, lenders will sometimes emphasize one number or the other to make an offer look more attractive than it is.

Lenders might emphasize either low closing costs or low rates to make an offer look more attractive, while raising the other number.

For instance, lenders might advertise low- or no-fee mortgages, saying they’ll cover the upfront costs for you. But these loans typically have a higher interest rate.

Other lenders might emphasize ultra-low interest rates, but charge higher origination fees to make up for it.

So when you’re shopping for a mortgage, read your rate quotes thoroughly. Look at rates, upfront fees, and your total estimated closing costs to make sure you’re getting the best deal overall.

The next section explains how to do that.

Check your rates (Aug 15th, 2020)

How to shop for mortgage rates (example)

Shopping for the best mortgage rate — and the lowest fees — is easy enough if you know what you’re doing. There are five basic steps:

  1. Make sure your credit and budget are polished up, so you’re getting your best possible offer
  2. Figure out which type of mortgage loan you need
  3. Find lenders offering the type of loan you’re looking for
  4. Select your preferred lenders based on advertised rates, recommendations, customer reviews, and expert reviews
  5. Request Loan Estimates (“quotes”) from those lenders and compare the rates and fees in each offer

That last step — comparing Loan Estimates — is key to finding the best mortgage rate and most affordable mortgage overall.

A Loan Estimate is a standard document you’ll get with any mortgage offer. It lists everything you need to know about a mortgage before signing on, including the interest rate, lender charges, loan length, repayment terms, and more.

By comparing multiple Loan Estimates side by side, you can tell instantly which lender is offering you the most affordable home loan.

How to compare mortgage rates — The Mortgage Reports

Sample loan estimate, Page 1. Image: CFPB

The first page of the Loan Estimate (shown above) clearly states your rate and projected monthly payment.

Those are the numbers people tend to pay most attention to when getting a home loan.

But the interest rate isn’t the only part worth looking at.

You should also compare the estimated closing costs with each lender, as well as the closing cost breakdown shown on page two.

How to compare closing costs — The Mortgage Reports

Sample loan estimate, Page 2. Image: CFPB

At the end of the day, the best mortgage rate alone doesn’t make for the best offer.

The rate and closing costs both have to be factored in. Their relative weight will depend on your goals, and how long you plan to stay in the house.

For instance, if you’re only going to own the house for a few years, a higher rate but lower upfront costs might make sense.

But if you’ll stay the full 30-year duration of the loan, you likely want the lowest interest rate possible. In that case, you might accept slightly higher upfront costs for a lower rate.

Check your rates (Aug 15th, 2020)

Tips to get the lowest mortgage rate

If you want the best mortgage rate, you have to shop around. That’s the number one rule. But there are other strategies you can use to get lower offers from the lenders you talk to.

  • Try for a last-minute credit boost. If you’re reading this, you’re probably past the point where “start improving your credit a year in advance” is helpful advice. But see what you can do in the short term. Your credit score makes a big difference in your mortgage rate, and improving it just a few points could lead to real savings. See: 5 ways to improve your FICO score today
  • Consider discount points. If you can afford it, you can pay a little more upfront for a better mortgage rate over the life of the loan. This could be especially smart if you plan to keep your home a long time. “Discount points” cost 1% of the loan amount, and typically lower your rate by 0.25%
  • Negotiate your rate. Negotiating with a lender probably sounds intimidating (after all, they’re the experts). But trust us when we say it can be done. Mortgage lenders have flexibility with the rates they offer, and they want your business. A lower rate quote from a different company might be the only leverage you need to negotiate a better offer with the lender you want
  • Negotiate your closing costs. Some closing costs are non-negotiable, like the third-party appraisal and credit reporting fees. But the fees your lender charges can sometimes be negotiated to save you moeny on the front end. Learn more about negotiating your closing costs here
  • Know when to lock your rate. Mortgage rates are tied to the U.S. and worldwide economies, so they move up and down every day — just like stocks. If you want to get the lowest possible rate, keep an eye on daily rate movements and be ready to lock when they fall

Getting mortgage quotes might not be the most enjoyable way to spend a day. But a few hours of effort are likely worth the thousands you could save in the long run.

One study found that people who compare just 3 lenders save $300 per year on average. And if you’re a savvy shopper, you could save a lot more.

Ready to get started?

Verify your new rate (Aug 15th, 2020)