Best Mortgage Companies in California

Whether you seek stardom in Los Angeles, enjoy the vibrant culture of San Francisco or prefer rural life in the Central Valley, California is a great place to call home. Thinking of buying or refinancing a home in the Golden State? Here’s your guide to the best mortgage companies in California. 

Best Mortgage Lenders in California

Ready to compare California lenders? Here are the mortgage companies that round out Benzinga’s top choices.

Mortgages Explained

As you start exploring California mortgage rates, you’ll notice various mortgage types and terms. Your mortgage type refers to whether a government agency insures your mortgage. “Mortgage term” refers to how long the mortgage lasts, assuming you don’t make any extra payments. Let’s take a closer look at the most common mortgage types and terms:

• FHA: FHA mortgages, which are backed by the Federal Housing Administration, are a popular choice with many buyers for a few reasons — including their low down payment requirements. These mortgages also have low credit score requirements, although lenders may set higher credit score minimums. Let’s say you have a credit score of 580 or higher. You can make a down payment as low as 3.5% of the purchase price. Borrowers with credit scores of 500 or higher might be able to qualify with a 10% down payment. 
• VA: VA loans help current service members and veterans buy homes. These loans can be used to buy a new home or refinance an existing mortgage. You can get a loan with no down payment. These mortgages offer flexible credit requirements and no mortgage insurance, which is insurance that protects the lender if you default on your mortgage. It also increases your monthly mortgage payments and you can save a lot of money in the long term if you don’t have mortgage insurance.
• Conventional: A conventional loan is a mortgage that isn’t insured by a government agency. These loans typically have higher credit score requirements. 

• 30-year fixed: FHA, VA and conventional mortgages can come with different terms. A 30-year fixed-rate mortgage is one of the most popular options. The 30-year term means that your mortgage will be paid in full in 30 years. The fixed rate means that the interest rate is always the same. This means that your monthly payment will remain the same as well. 
• 15-year fixed: A 15-year fixed-rate mortgage has higher monthly payments than a 30-year fixed-rate mortgage. You’ll pay less in interest over the life of the mortgage. A 15-year mortgage has the same interest rate and monthly payments for the entire mortgage term. 
• 5/1 ARM: An adjustable-rate mortgage (ARM) offers an interest rate that can change. These mortgages usually start with an initial period with a fixed rate. A 5/1 ARM has the same interest rate for the first 5 years. After that, the lender can change the interest rate annually. Lenders change the interest rate based on what’s going on with the economy and the real estate market. 

Which Mortgage Lender is Best for You?

It’s best to contact multiple lenders for refinance or purchase quotes. What should you look for in a lender? Here’s a great list:

• Reputation: Lenders develop a reputation, whether it’s good or bad. Ask family and friends about which lenders they’ve worked with. Look at 3rd-party rating websites for more information. You can also check with the Better Business Bureau to see if there are any complaints against the lender. If there are complaints, look for how the lender responds to those complaints.  
• Service: How responsive is the lender to your request for a quote? Does the lender listen to you and to your preferences? If the lender seems to have its own agenda or it doesn’t make you a priority, you might want to move on. 
• Mortgage options: Does the lender have the type of mortgage you need? For example, if you want a VA mortgage, does it offer those mortgages? If so, how often does it originate those mortgages? You want a lender with experience in the type of mortgage you’re looking for. 
• Education: Does the lender offer educational resources? For example, does it have mortgage calculators? Articles about relevant topics? Lots of educational resources means the lender wants you to understand how mortgages work and make educated decisions. 
• Technology: Does the lender use technology to speed up loan processing? For example, can you complete the application online? Can you securely upload documents? Even if you work with a lender in person, technology can help move the process along. 

Trust your instincts as you choose a lender. If something feels “off,” go with a different lender. You don’t have to explain your decision. You can simply decline a lender’s offer and move on. 

Lender Credit Score Minimums in California

Your credit history influences your interest rate and your ability to obtain a mortgage. Lenders start with your credit score. Computer models generate credit scores based on how you’ve handled credit and debt in the past. If you’ve made timely payments and keep your balances low, you’ll have a higher credit score. Lenders have minimum credit score requirements for borrowers. Here are some California lender credit score minimums.

Current Mortgage Rates in California

Lenders base mortgage rates on how the economy and the real estate market perform. In general, when the economy is doing well, mortgage rates increase. When the economy slows down, mortgage rates drop to encourage more people to borrow. 

Lenders change rates on a day-to-day basis. They change rates in response to small market changes. At Benzinga, we update our rates frequently to reflect the most recent information. Here are the current mortgage rates in California.

Average Days to Close on a Loan

Your mortgage closing is the end of the application process. When you apply for a mortgage, the lender reviews and underwrites your application. It confirms your financial information and it might ask for additional documentation. Once the lender approves your application, the next step is your closing meeting. That’s when you sign all your mortgage documents. You also pay the balance of your down payment and closing costs. 

Your lender must have all your closing documents ready at least 3 days before closing. Here are the average closing times for some of California’s lenders: 

Buy Your California Dream Home

Depending on your income, you may want to poke around at the California Housing Finance Agency’s programs. CalHFA works with private lenders to offer low-interest mortgages and down payment assistance. There’s even an assistance program for public school employees. 

Home prices in California vary widely. Take your time and look at several homes until you find one that fits your needs and your budget. An experienced local real estate agent can help you navigate the process, especially in higher-priced areas.