For all the home borrowers, the high interest rates and the soaring prices makes it difficult to afford home. Therefore, saving for the down payment is one of the most arduous tasks to home ownership. Therefore, for the ease of the borrowers we have compiled a complete list of best mortgage lenders for low down payments. Thankfully in U.S there are lenders that provide the small down payment option along with subsidized closing cost to help the potential home buyers.
The terms and condition for no down payment loans are stringent therefore it is a viable option to choose mortgage loans with low down payment. The competitive interest rates and closing cost assistance is one of the biggest advantages of these lenders. The low-down payments are applicable on the FHA loans that are insured by the Federal Housing Administration with down payment of 3.5% and conventional loans with down payment of 3%. The list of the best mortgage lenders for low down payments includes a mix of FHA, VA and conventional loans.
Table of Contents
Best Mortgage Lenders for low down payments – Quick Glance
- Bank of America – Best traditional bank offering low down payments
- NBKC Bank – Best for FHA loans with small down payment
- PennyMac – Good option for FHA loans with low down payments
- Rising Bank – Best option for fast closing cost and below average interest rates
- BMO U.S – Great for large bank customer support with small down payment
- Chase – Great option for guaranteed closing timeline for a large user base
- Veterans United – Great low-down payment option for VA loans
- Citi Bank – Best for closing cost assistance for various loaning schemes
- New American Funding – Good small down payment option for greater customer satisfaction
- Conexus Credit Union – Great option for small payments for jumbo loans
Charting the Best Mortgage Lenders for low down payments for 2024
| Lender | Minimum Credit Score | Minimum Down Payment | Best For |
| Bank of America | 740 | 0% | Best traditional bank offering low down payments |
| NBKC Bank | 620 | 3.5% | Best for FHA loans with small down payment |
| PennyMac | 580 | 3.5% | Good option for FHA loans with low down payments |
| Rising Bank | 580 | 0% | Best option for fast closing cost and below average interest rates |
| BMO U.S | 580 | 1% | Great for large bank customer support with small down payment |
| Chase | 580 | 0% | Great option for guaranteed closing timeline for a large user base |
| Veterans United | 620 | 0% | Great low-down payment option for VA loans |
| Citi Bank | 620 | 0% | Best for closing cost assistance for various loaning schemes |
| New American Funding | 580 | 3% | Good small down payment option for greater customer satisfaction |
| Conexus Credit Union | 620 | 0% | Great option for small payments for jumbo loans |
Bank of America
| Minimum Credit Score | 740 |
| Minimum Down Payment | 0% |
| Interest Rate | Below than national average |
Bank of America is one of the credible options for the home buyers with its comprehensive support through First time homebuyer online Edu Series educational programs and Better Money Habits. Being on of the best mortgage lenders for low down payments, the lending teams are available for the assistance of the applicants on the channel of their preference. Majority of the mortgage products are geared towards the first-time home buyers that includes the affordable mortgage solution that only requires down payment of 3%. Moreover, the mortgage applicants that are enrolled in the Preferred Rewards program are eligible for reduction in loan origination fee based on the type of the investment account and their credit history.
Availability of Bank of America mortgage loans with low down payment
The loans are available in all 50 United States that includes Washington D.C as well.
| Pros | Cons |
| Offers a range of loan options that are readily available for the first0tiem home buyers | Closing time may take longer than the duration mentioned in the site |
| There are several ways to apply for the loan that includes the fully online option as well |
NBKC Bank
| Minimum Credit Score | 620 |
| Minimum Down Payment | 3.5% |
| Interest Rate | Below than national average |
NBKC has placed special emphasis on VA loans that are easy to secure through this bank. It is good for borrowers who want low interest rate and online experience with phone assistance. Being one of the best mortgage lenders for low down payments it offers some hard to find products that include construction loans, specialty mortgages for pilots and much more. He low interest rate and down payments are one of the key advantages and preference of this lender. Furthermore the mortgage rate tool on the website is easy to use and it only takes location and credit score into account to display customized rates.
Availability of NBKC mortgage loans with low down payment
This bank has small physical footprint but it lend the money to home buyers in all 50 physical states .
| Pros | Cons |
| Fast and responsive service with greater customer satisfaction and response rate | Does not offer mobile home loans and USDA |
| Loans and services are available nationwide with easy application process | No down payment assistance program |
| Displays customized rates without requiring contact information from the lender |
Best mortgage lenders for first-time homebuyers in 2024
If you are home buyer who is lending the loan for the first time NBKC bank is one of the secure option. The preapproval of the loan application is on the same day as that of application. For further details on the mortgage lenders for first-time homebuyers you can head to the blog .
PennyMac
| Minimum Credit Score | 580 |
| Minimum Down Payment | 3.5% |
| Interest Rate | Below than national average |
PennyMac is one of the biggest mortgage lenders in the U.S and is good for borrowers that are seeking government backed loans. It offers a wide range of loaning options as well as refinance options to a large user base. It makes it easy to get the customized mortgage rates online for the ease of the users. Also, it is regarded as a good option for FHA loans in the list of best mortgage lenders for low down payments. Although the origination fees are higher than most of the lenders and the unavailability of home equity lines of credit are few of the down sides of the loan .
Availability of PennyMac mortgage loans with low down payment
PennyMac mortgage loans are available in all the U.S states expect New York.
| Pros | Cons |
| Specialized in government backed loans and other refinance options | Does not offer mobile home equity line of credit |
| Availability of the online tool makes it easy to customize the rate quote | Charges high origination fee |
| “Lock and Shop” lets you customize the rates for almost 90 days |
Rising Bank
| Minimum Credit Score | 580 |
| Minimum Down Payment | 0% |
| Interest Rate | Below than national average |
Rising Bank offers a fully online experience to the users to lend money to buy homes. Being one of the good options in the list of best mortgage lenders for low down payments it provides an automated and streamlined mortgage process for the borrowers. All those who value personal experiences and offer a smooth home loan lending process can turn towards this mortgage lender. This bank offers 3% minimum payment for the government backed mortgages and conventional loans. Rising Bank is among the best mortgage lender for low down payments with mortgage closing of at least 21 days while some loans only take 7 days to close.
Availability of Rising Bank mortgage loans with low down payment
The mortgage loans are available in all the United States that include Washington DC as well.
| Pros | Cons |
| Offers the ability to complete the application process online | The application fee for this mortgage lender is on the higher side |
| Fast closing timeline to facilitate a large user base |
BMO U.S
| Minimum Credit Score | 580 |
| Minimum Down Payment | 1% |
| Interest Rate | Below than national average |
BMO U.S provides specified loan types Such as Neighborhood home loan products with a down payment as less as 1%. The borrowers are not bound to pay PMI and are eligible to receive $75,000 in down payment. With great customer support to the home buyers in the list of best mortgage lenders for low down payments it works with DPA programs to fully fund the down payment. Furthermore the bank offers grant programs to fully assist customers in the home purchasing journey. The closing timeline for loan is usually 30 to 45 days , if the applicants complete the entire documents on time.
Availability of BMO U.S mortgage loans with low down payment
The loans are available in all the U.S States that includes Washington D.C as well.
| Pros | Cons |
| Neighborhood loan products provides low monthly payment and does not require PMI | Does not offer VA and USDA loans |
| Provides live customer support even on Sundays |
Chase
| Minimum Credit Score | 580 |
| Minimum Down Payment | 0% |
| Interest Rate | Below than national average |
Chase offers an assortment of loan products that ease the home buying process for the users. It offers range of products that include VA , FHA loans with the exclusive DreaMaker mortgage for home buyers. Majority of the buyers with certain income cannot afford the purchase of the home therefore Chase offers the opportunity to middle income house holders to afford home. Moreover, the best mortgage lenders for low down payments require minimum down payment of 3% and take $500 credit after taking the homebuyer education course.
Chase offering does not stop here as it provides Chase Homebuyer Grant with a credit of $2,500-$5,000 on specific loan products with low interest rates. No matter what type of loan you choose you can easily expect a streamlined closing process.
Availability of Chase mortgage loans with low down payment
The loans are available in all the 50 U.S sates that includes Washington D.C as well.
| Pros | Cons |
| Provide range of grants and discounts to the eligible borrowers | Chase lending advisors are not available in all the U.S states |
| Guarantees on time closing for the interested home loan borrowers | Home grant is restricted to certain locations |
Veterans United
| Minimum Credit Score | 620 |
| Minimum Down Payment | 0% |
| Interest Rate | Below than national average |
If you are in search of VA loan with low down payment then look no other than the Veterans United. The loans are geared towards the veterans and active duty service members who are eligible reservist looking for VA loans. The minimum credit score required to secure VA loan is 620. Civilian borrowers without the military connection can apply for USDA , FHA loans after speaking with the loan officer. As a full service lender in the list of best mortgage lenders for low down payments, you can work with the lending officer to compare different mortgage offers.
This lender also offers insurance services in addition to specialized assistance to the borrowers with a military background. But one of the notable drawbacks of Veterans United is that it does not offer home equity line of credit.
Availability of Veterans United mortgage loans with low down payment
The mortgage loans are available with small down payments in all the 50 U.S States that includes Washington D.C as well.
| Pros | Cons |
| Provides 24/7 customer service to the users | Parent company mortgage rates are on the higher side |
| Offers free credit counselling to the home loan borrowers | Does not offer home equity loans and second mortgages |
| The mortgage rates are on the low side in comparison with the other top-tier mortgage lenders |
Citi Bank
| Minimum Credit Score | 580 |
| Minimum Down Payment | 0% |
| Interest Rate | Below than national average |
Citi Bank has exclusive program for home loaning that are designed to make home borrowing process easy for the moderate income earners. Being one of the best mortgage lenders for low down payments it makes the purchases of home less complicated for the users. With minimal credit requirements it offers conventional loans with great monthly payments for the users . Borrowers can get the loan with as little as 3% with no PMI requirement. Moreover, this program requires home ownership counseling at various instances.
Citi also offers Lender Paid Assistance program that provides credit of up to $75,00 to assist the borrowers with closing cost. Furthermore, Citi has flexible credit guidelines and even accept the credit score that is lower than 620.
Availability of Citi mortgage loans with low down payment
The loans are available in all the 50 U.S states that includes Washington D.C as well.
| Pros | Cons |
| Provide exclusive home loan programs for the users | Lack of physical branches for the assistance of the home buyers |
| Home Run mortgage has no PMI requirement and offers competitive price | Closing must take place in person with the home loan borrower |
| Offers special promotion of $500 towards the closing cost |
New American Funding
| Minimum Credit Score | 580 |
| Minimum Down Payment | 3% |
| Interest Rate | Below than national average |
New American Funding provides a plethora of loaning products that include fixed rate and adjustable mortgages along with refinancing option. The loan repayment terms are flexible and range from 8 to 30 years. If you want loan with small down payment you can call the lending officer to check the details for the eligibility of the loan for you. Being a fine option I the list of best mortgage lenders for low down payments it is geared towards the military members and self-employed borrowers. Moreover , the qualification of the loan is comparatively easy as compared to other mortgage lenders .
Availability of New American Funding mortgage loans with low down payment
New American Funding provides mortgage loan in 48 states except Hawaii and New York.
| Pros | Cons |
| Receives high marks for customer satisfaction | Charges high mortgage origination fee |
| Provide home equity line of credit that can be utilized for second home or owner-occupied home | Personalized mortgage rates are not available on the official website |
| Has an exclusive program to enable buyers to make cash offers |
Conexus Credit Union
| Minimum Credit Score | 640 |
| Minimum Down Payment | 0% |
| Interest Rate | Below than national average |
Conexus Credit Union charges no prepayment fees that means you have to pay your mortgage early to save the money on the interest charges. For the borrowers who want loans on smaller down payments , it is a viable option for jumbo loans. Also , it offers 3% down payment on its conforming loans. Moreover it also offers promotional discounts to the users with almost $700 of on the closing cost. For the ease of users , the borrowers can complete the full-fledge mortgage application online.
Availability of Conexus Credit Union mortgage loans with low down payment
The loans are available in all the 50 U.S states except Maryland.
| Pros | Cons |
| Based on the eligibility it allows 10% down on the jumbo loans | Charges high mortgage origination fee |
| Offers low competitive interest rates to the home buyers | APY on the saving account is not competitive |
| Has extensive number of branches all across the U.S |
How to buy a house with low down payment?
There are multiple mortgage programs that offer the requirement for low down payment. The low down payment options are geared towards the first time home buyers who generally have an easier time to qualify for it. If you are looking to buy home with small down payment consider the following mortgage loan options and compare the lenders accordingly.
Types of Loans that require low down payment
The government backed loans generally don’t require small or no down payment. The other loan options are the following:
VA loans – When the sale price is lower than the home appraisal value than VA loans either require small or no down payment. It is important to mention that the program is exclusively designed for veterans, U.S military members and families.
USDA loan – This home is particularly geared towards the home buyers in the eligible rural locality . the applicants must have moderate income to qualify for the financing of the loaning scheme.
What are the pros and cons of mortgage loans with low down payment?
Pros
- If you choose the best mortgage lenders for low down payments you get out of the renting sooner with the homeownership
- Various lenders offer exclusive home loaning schemes that are good for those with little saving and makes the home buying process efficient .
- With small down payment you have the option to reserve your savings for other financial goals and emergencies
Cons
- The low-down payment loans generally require mortgage insurance
- Small down payments mean that you have to pay high interest rates to the lenders
- When you have less money down that also means that while borrowing you have to make high monthly mortgage payments
What is the methodology of section of best mortgage lenders for low down payments ?
The selection of the best mortgage lenders for low down payments are doen on the basis of the following factors
Types of loan offered – The most common mortgage loans are FHA loans, conventional loans , VA loans . if you have small down payment than you have to chose one of the loaning option and then further discuss it with the lending officer.
Fixed rate APR – Variable rates go up and down during the life time of the loan therefore it is important to go for fixed rate APR for the monthly payment of the loan . This way it makes it easier for you to manage your budget.
Closing timeline – The best mortgage lenders for low down payments does not inculcate the lender that have a closing time greater than 45 days . As each lender offers specific closing timeline depending on the time of the loan therefore you can choose them accordingly.
Fees – The fees that are generally associated with the mortgage lenders are origination fee , underwriting fee , application fee , processing fee and more. Each lender is evaluated carefully so that the process of charging these fee charges remain transparent to the users.
Streamlined application process – All the lenders inculcated in the list of best mortgage lenders for low down payments offer fast application process along with detailed assistance to the users.
Customer Support – Most of the best mortgage lenders for low down payments offers support via email , messaging , phone etc. Some lenders have online resource hub to help educate the masses with different loaning options.
No penalties – None of the mortgage lenders that offer best mortgage loans with low down payment charges any money for paying off early .
Minimum down payment requirement – The minimum down payment requirement varies for loan to loan and lender to lender . We have mostly inculcated the lenders that offer specialty loans with smaller down payments to the users.
