Are you a first-time homebuyer who is looking for the best mortgage lender with the best mortgage rate? If so, this article will highlight the two best mortgage lenders online.
Buying a property in 2024 and beyond is sound because:
- The stock market is too volatile
- Mortgage rates are coming back down
- The demand for housing is increasing due to increased affordability and lower rates
- Corporate profits are surging
- Consumers have pent-up savings
- The intrinsic value of housing has gone way up since we are spending more time at home
If you are a first-time buyer, you can take advantage of lower rates.
The Best Mortgage Lender For First-Time Buyers
If you are a first-time homebuyer, consider using a convenient online lending marketplace. They have a comprehensive network of qualified lenders ready to help you get the best mortgage terms possible.
Free Quotes, No Obligation
The great thing about online rate platforms is that you can apply for a no obligation loan online in minutes. And within the hour, you can get actual prequalified rates from competing banks. Then you can pit your offers against each other and squeeze them even more for the best terms possible!
You, the borrower don't have to pay rate platforms a penny. It's the banks who pay them to compete for your business. As a result, lenders are motivated to try and get you the best loan possible to win your business.
Be forewarned the lenders can be quite swift. Their e-mails and phone calls will die down after several days once they realize you have gone with another lender, or are not interested in their offers.
I like to get a group of quotes in writing and then bring these quotes to my main bank to get them to match or beat them. Using this strategy, I was able to get my bank to refinance my jumbo loan to a 2.375% interest rate from their initial 2.5% offer.
Online Mortgage Lending Marketplace Review
Online marketplaces such as LendingTree are a great way to get multiple real mortgage refinance quotes all in one place.
Mortgage rates collapsed to all-time lows in 2020 after the Fed announced on June 20, 2019 they would be taking a very accommodative stance going forward. As a result, interest rates collapsed. When the Fed began to raise rates again, interest rates rose from 2021-2023. Now in 2024 they are starting to come back down again.
With rates on the decline there is an opportunity to invest in real estate in 2024 and beyond due to increased affordability. If you have an existing mortgage, also take advantage of lower mortgage rates by refinancing.
I personally refinanced my primary residence at the end of 2020 to a 2.125% 7/1 ARM at no cost. I actually got a $500 credit to refinance! It is fantastic that after a 35% appreciation in my property since I bought it in 2014, I’m now paying 30% less a month as well.
Shop around before refinancing if you’re looking to lower your monthly mortgage rate. Look at multiple mortgage offers where you can refinance into an ARM or a 30-year fixed mortgage. You can also choose a 15-year fixed rate mortgage or even cash-out refinancing if you wish. Take advantage of lower interest rates and talk to your lending offer for personalized recommendations.
Why You Should Refinance Now
Mortgage rates climbed from 2021-2023 as you see in the chart. But they are finally rolling over and starting to decline again in 2024.
If you are a new homebuyer or want to refinance, check what the latest rates are and look for any opportunities to save money. It's important to get as many bids as possible to get the best mortgage rate and terms as possible.
A big part about growing your net worth is doing everything possible to minimize expenses. I believe everybody should at least own their primary residence to get neutral the ever rising property market. Once you own, it's all about lowering your property taxes and getting the best mortgage rate possible.
The Best Mortgage Lender Has The Best Rates
Take advantage of lower rates and shop around for the best deals. With online mortgage lender portals, you can get competitive, real quotes in under three minutes. Let banks compete for your business so you can get the best rates and save money.
Interest Rates Will Continue To Stay Low
In a low interest rate environment, I prefer taking out a 5/1 ARM amortizing over 30 years. Why pay a higher rate when the average length of homeownership is 7 years and interest rates are in a structural decline? You can certainly go for a 30-year fixed loan if you want absolute peace of mind and believe interest rates will be aggressively higher in the future. But if the 5/1 ARM mortgage rate is at least 1% cheaper, then I would strongly consider an ARM.
Take the monthly interest savings and save or invest it. There's a interest rate hike cap that's fixed for one year after the fixed adjustment of an ARM is done. There's also a lifetime interest rate cap that's usually no more than 4% – 5% higher than the initial rate. You can always refinance your ARM before the fixed period is over like I've done many times before.
Invest In Real Estate For As Little As $10
In addition, it's a great time to invest in real estate and diversify your portfolio. You can invest in real estate without taking on a mortgage by investing in private real estate funds. Take a look at Fundrise, a leading private real estate investment firm, manages over $3.3 billion in assets with a minimum investment of just $10. It focuses on residential and industrial real estate in the Sunbelt region, known for its lower valuations and higher yields.
Personally, I've allocated $954,000 to private real estate funds, predominantly targeting properties in the Sunbelt. With remote work becoming more prevalent, there's a growing trend towards lower-cost areas of the country.
About the Author: Sam began investing his own money ever since he opened an online brokerage account in 1995. Sam loved investing so much that he decided to make a career out of investing by spending the next 13 years after college working at two of the leading financial service firms in the world. During this time, Sam received his MBA from UC Berkeley with a focus on finance and real estate.
About Financial Samurai: FinancialSamurai.com was started in 2009 and is one of the most trusted personal finance sites today with over 1.5 million organic pageviews a month. Financial Samurai has been featured in top publications such as the LA Times, The Chicago Tribune, Bloomberg and The Wall Street Journal.
Fundrise is a sponsor of Financial Samurai, and Financial Samurai is an investor in Fundrise.