Best Mortgage Lenders for First Time Home Buyers in Arizona

When it comes to first-time home buyers in Arizona, Rocket Mortgage® is often regarded as a leading mortgage lender

FHA loans? Down payments? Closing costs? Buying a home for the first time means you probably have lots and lots of questions. Choosing the right mortgage company can make the process easier. 

We’ll take a look at some of the best mortgage companies in Arizona when you buy your first home. We’ll also go over some of the different types of mortgages you can qualify for as a first time buyer, current mortgage rates, and what to expect when you close on your loan. 

4 Best Mortgage Lenders in Arizona for First Time Buyers

Let’s take a look at some of the best lenders for first time buyers in Arizona.

You’re probably looking for the easiest and least complicated way to apply for a home loan if you’re a first time buyer in Arizona. Rocket Mortgage® is a first time buyer’s best friend. This mortgage company has simplified the mortgage application process — you can even complete the mortgage application on your phone.

Rocket Mortgage® offers nearly every type of home loan you could need, including FHA loans, USDA loans, VA loans and jumbo loans. Its online education center also includes a vast amount of information that can make buying a home easier.

Why We Like It: Rocket Mortgage® is recognized as the best overall mortgage lender for first-time home buyers in Arizona because of its user-friendly online platform, which simplifies the application process and provides quick pre-approval decisions. Additionally, their competitive rates and exceptional customer service make it a top choice for those navigating the complexities of home buying for the first time.

2. Best for Low Credit Score: Keller Mortgage

Your credit score significantly influences your ability to get a mortgage loan. If you’re still working on building your score but you don’t want to wait to buy a home, consider a loan from Keller Mortgage. Though most companies require borrowers to have a 620 credit score to qualify for a conventional mortgage loan, you may be able to qualify for a loan with a score as low as 600 points through Keller Mortgage. 

Keller Mortgage also offers FHA loans, which can help you buy a home with a score as low as 500 points, depending on your down payment. 

Why We Like It: Keller Mortgage is highly rated as the best option for those with low credit scores, making it accessible for first-time homebuyers in Arizona who may feel challenged by traditional lending standards. With competitive rates and a streamlined application process, Keller Mortgage supports aspiring homeowners in achieving their dream of owning a home, regardless of their credit history.

3. Best for Comparing Interest Rates: better.com

Calculating your interest rate is an essential consideration when you decide if you’re ready to buy a home. But interest rates change on a daily basis, so how can you accurately figure out how much you can expect to pay when you apply for a home loan?

better.com is focused on helping you get the lowest interest rate possible on your conventional or FHA loan. You can see how much you’ll pay on your loan without the commitment of applying for a preapproval when you use better.com’s up-to-the-minute interest rate calculator. If you find a better deal elsewhere, better.com will even beat a competitor’s offer thanks to its Better Price Guarantee. Want to pay as little interest as possible? Of course you do. Be sure to consider better.com.

Why We Like It: Better.com is highly regarded for comparing interest rates, providing first-time home buyers in Arizona with a straightforward platform to find the best mortgage options tailored to their financial needs. By offering transparent rates and user-friendly tools, Better.com simplifies the mortgage process, making it easier for new homeowners to secure financing with confidence.

4. Best for In-Person Service: Chase

Does the personal touch of visiting a bank give you peace of mind? Consider applying for your home loan through Chase. One of the largest mortgage providers in Arizona, Chase currently operates over 200 offices in Arizona. This means that no matter where you are, there’s bound to be a location near you. Chase offers both conventional and government-backed mortgage loans, as well as one of the fastest average closings in our review.

Chase also effortlessly combines both online and traditional mortgage processes. You can begin your application online and finish with a representative or you can visit your local branch and complete the entire application process.

Why We Like It: Chase stands out as the best mortgage lender for first-time home buyers in Arizona due to its commitment to providing personalized, in-person service that caters to the unique needs of each customer. With a team of knowledgeable professionals ready to guide you through the home financing process and answer your questions, Chase ensures a smooth and supportive experience for first-time buyers.

The Housing Market in Arizona: An Overview

Before we go over the details of buying a home, let’s take a look at the current housing market in Arizona.  

Total Households: 2,907,014

Median List Price: $475,028

3 Most Expensive Cities in Arizona to Buy a House:

• Phoenix-Mesa-Chandler
• Flagstaff
• Prescott Valley-Prescott

3 Most Affordable Cities in Arizona to Buy a House:

• Douglas
• Bullhead City
• Yuma

Preparing for a Mortgage

Getting a mortgage loan begins with applying for preapproval. A preapproval is an estimate from your lender that tells you about how much money you can afford to spend on a home. You should get preapproval before you start to shop for a home to ensure that you stay within your budget.

Follow your lender’s specific application process when you apply for a preapproval. You’ll enter a little information about where you live, your household income and credit information. Your lender will usually ask you to submit a few documents to verify your income. As a general rule, you’ll need to provide at least:

• 2 paystubs
• 2 W-2 forms
• 2 months of bank statements

You may need to provide additional documentation if you’re self-employed, such as your entire last tax return and a profit-and-loss statement from your business.

Your lender will also check your credit report before it issues you a mortgage loan. Your credit score plays a major role in your ability to get a home loan. Each lender sets its own minimum standard for credit scores. Here’s the minimum score you’ll need to get a loan with a few of Arizona’s top lenders. 

Mortgage Options

Let’s take a look at a few different types of loans you can use to buy a house.  

Conventional Mortgages

Conventional mortgages are the most common type of home loan. You can use a conventional loan to buy any type of home and anyone can qualify as long as you meet your lender’s standards. As a general rule, you’ll need a credit score of at least 620 points and a down payment of at least 3% to qualify for a conventional loan. 

FHA Loans

FHA loans are insured by the Federal Housing Administration. They were invented to make homeownership more affordable if you have a lower income and/or poorer credit. You can qualify for an FHA loan with a score as low as 580 points and a down payment of 3.5%. Your home must meet minimum livability standards to qualify for an FHA home loan.  

USDA Loans 

USDA loans are insured by the United States Department of Agriculture. Your home must be in a qualified rural or suburban area to apply for a USDA loan. You can buy a home with no money down and a credit score of 640 points. Your total household income must also be lower than the income limit for your ZIP code by the USDA. 

VA Loans 

VA loans are insured by the Department of Veterans Affairs. You can buy a home with $0 down and a credit score of 620 points with a VA loan. You must also meet service requirements. Your home must also meet minimum livability standards.  

Jumbo Loans

Jumbo loans exceed the conforming limit set by mortgage investors Fannie Mae and Freddie Mac. If you want to borrow more than $510,400, you’ll usually need a jumbo loan. Jumbo loans have stricter standards than most other types of loans because they’re riskier. 

First Time Home Buyer Programs in Arizona

You may qualify for government assistance if you’re buying a home for the first time. Let’s take a look at a few first time buyer programs for Arizona residents. 

Arizona Home Plus is a program that offers affordable 30-year fixed-rate mortgages for residents who may otherwise have difficulty qualifying for a loan. You might also qualify for down payments and closing cost assistance, depending on your income. To qualify, you must buy a home in Arizona, intend to live in your new home as your primary residence, and complete a home buyer’s education course.   

HomePath Ready Buyer Program

The HomePath Ready Buyer program allows first time buyers to purchase a Fannie Mae-owned foreclosure with as little as 3% down. You can also apply for up to 3% of your closing costs  Fannie sells the foreclosures in as-is condition, so you might need to budget for a few repairs before you invest. However, if you’re shopping on a lower budget, a HomePath home can be a great choice. You must first complete a buyer education course. 

Good Neighbor Next Door

Are you currently employed as a teacher, firefighter, emergency technician or law enforcement professional? If you are, you might qualify for HUD’s Good Neighbor Next Door program. Good Neighbor Next Door allows select public employees to purchase a HUD-owned property for 50% off. These properties are already deeply discounted and sold in as-is condition. To learn more, check out HUD’s program page here. 

Current Mortgage Rates in Arizona

When you get a refinance quote or purchase quote in your preapproval letter, your lender will also tell you what percentage interest you’ll pay on your loan. Each monthly mortgage payment includes 2 parts: principal (money you pay back towards the balance you borrow) and interest (additional money that goes to your lender).

No matter what type of loan you choose or lender you borrow from, you’ll pay some form of interest. Most lenders calculate interest as a percentage of your principal balance remaining. The specific percentage you’ll pay in interest will depend on a wide variety of factors, including your credit score, down payment, the current state of the local housing supply and even the overall bond market.

Interest rates change on a daily basis. We update our tables frequently to ensure that you’re getting the most up-to-date information possible. Let’s take a look at current mortgage interest rates in Arizona for 3 of the most common loan types.  

Closing a Mortgage

You’ve gotten a preapproval, found the right home, made an offer and gotten an acceptance from the seller. There’s nothing left to do now other than decide how you’ll decorate your new home — right?

After you get a purchase quote and an acceptance from a seller, you must go through the closing process. The specific steps you’ll go through before you close will depend on your lender. Most include 4 steps:

1. Appraisal

During an appraisal, a home value expert will visit your property and assign a general value to your home. Mortgage lenders require an appraisal before they can issue a loan because they can’t loan out more money than your home is worth.

2. Inspection

An inspection isn’t the same thing as an appraisal. During an inspection, an inspector will take a walk through your home and look for specific problems and things that need to be repaired. Most mortgage companies don’t require you to have an inspection before you buy a home. However, you should still get one so you’re sure that you aren’t walking into a home with thousands of dollars in hidden repairs.

3. Underwriting

During underwriting, your lender will check your paperwork and ensure that you qualify for your home loan. A lender may verify your credit, assets and employment. Most of the underwriting process takes place behind the scenes on your lender’s side.

4. Attend a Closing Meeting

Once all other steps are completed, your lender will schedule a closing meeting. During closing, you’ll pay your down payment and closing costs and sign your loan paperwork.

How long does closing take? The answer depends on your lender. Some lenders take months to close on a loan and others specialize in fast closings. Let’s take a look at the average time to close with some of Arizona’s most popular lenders. 

Find the Right Mortgage for the First Time

A mortgage is a huge, life-changing commitment. It’s important that you take some time to compare all your options before you choose a mortgage loan provider. The right mortgage lender will make buying your first home easier. The wrong one may leave you stressed out and paying thousands of dollars extra in interest. Don’t be afraid to shop around for lenders and interest quotes before you make a decision. 

Frequently Asked Questions