An Internet mortgage is a loan that is requested and serviced through a web-based lender. Instead of applying for a loan through a traditional bank loan officer or broker, the applicant works directly with the lender online. The qualifications, documents, and processes are the same as those with a traditional mortgage, but the rates and fees tend to be lower.
Many Internet mortgage companies have their websites dedicated to receiving and processing quotes and applications 24/7. Due to around-the-clock access to the application process, most borrowers’ questions are addressed in a non-personalized way through its website. Applications, appointments, and subscription approvals are automated, and typically there are no fees or obligations for filling out an application on these websites.
If a potential borrower decides to accept an Internet mortgage loan, an appraisal fee is required to guarantee the loan. As with a traditional mortgage, the online lender will order an evaluation to be conducted at the property through an external provider. The potential borrower has the option to lock in the interest rate that is in effect at the time the loan is secured or take the risk of obtaining the current rate at the time of closing.
If the online borrower qualifies for the loan, the computer system automatically approves most Internet mortgages of the online lender. If there is an issue with the online application, a lender representative will contact the potential borrower and verify the information or obtain the needed documentation. Regardless of whether an applicant is approved automatically or manually, proof of income must be presented to the lender.
Since the loan is not obtained using a loan officer or mortgage broker, there are no commissions involved, resulting in lower fees and a lower interest rate. Some fees are universal such as opening fees and closing costs, whether a traditional mortgage or internet mortgage is obtained. However, a borrower might save money over the loan’s life due to a lower interest rate. Loan funds are usually connected directly by the lender for closing agent documents, and loans are delivered and signed for in a title office or using a lawyer.
Other websites offer internet mortgage leads to potential borrowers. They direct the borrowers to the lenders who are willing to offer direct loans. Some of these sites may allow potential borrowers to compare mortgage rates, interest rates, and loan conditions. Refinancing, new purchases, residences, and rental homes are all eligible for an Internet mortgage.
The Top Nine Online Lenders
Better Mortgage
Some of the features that have Better Mortgage on the list are that it has zero lender fees, which can be a draw to this lender. They also cater to those who don’t have the best credit with an easier credit threshold of just 580. However, one drawback is that Better Mortgage has a smaller range of loan types.
Guaranteed Rate
While Guaranteed Rate may have slightly higher interest rates than other lenders on this list, it still has a lot to offer as a choice for your online lender. Guaranteed Rate has low fees, extremely positive customer reviews, and various loan products backed by the USDA and the VA.
Supreme Lending
Supreme Lending has higher rates than other lenders, but customers love this lender and give it high reviews. These reviews are likely due to Supreme Lending’s reputation as a company with excellent service and customer care.
loanDepot
loanDepot has great mortgage rates and minimal opening fees. And its customers give it high marks on customer reviews, which is always a good sign. Another feature that sets it apart is that loanDepot offers FHA 203(k) loans, which help you finance a fixer-upper. Many lenders are hesitant to loan for a home that needs a lot of work.
Rocket Mortgage
Rocket Mortgage is an all-online mortgage lender and is under the Quicken Loans umbrella. Quicken Loans, known as one of the largest mortgage lenders in America, lends great credibility to its online product.
Reali Loans
Reali Loans was formerly known as Lenda. It makes a list because Lenda was fairly well-rated, and Reali Loans is expected to be the same as it builds its reputation.
SoFi
SoFi makes this list for the low opening fees, rates, and loan costs. It requires the highest credit score of 660 and requires a minimum of 10% down, possibly making it off your list, but if you meet these criteria, it is highly recommended among the others on this list.
Movement Mortgage
Movement Mortgage offers competitive, though not the lowest, costs, fees, and rates. However, it is the highest rated on the list by customers.
NBKC (National Bank of Kansas City)
Though listed last on the list, NBKC is likely the best overall online lender on the list. It scores high on low mortgage rates and involved fees. It also rates among the highest of the Internet lenders on this list.
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