Minnesota Mortgage Rates

Mortgage in Minnesota: Top Lenders in 2024

Are you considering purchasing a home in Minnesota State? The easiest way to do so is to use a mortgage loan, which is often the most straightforward approach. However, it's crucial to note that terms and conditions for home loans can differ significantly among various mortgage lenders (you can use our mortgage calculator to estimate your future expenses). In the framework of this guide, we’ll review some of the top-rated lenders and try to find out which ones are worth considering.

MN Mortgage Lenders Comparison

All the lenders under review are reputable companies known for offering competitive rates and demonstrating strong track records. To provide you with comprehensive insights, we will compare them based on several essential criteria, including APR, minimum down payment, minimal requirements, customer service quality, and any unique features or benefits they may offer. This comparison will help you make an informed decision when selecting the lender that best suits your financial needs and preferences.

Quicken Loans Mortgage

Quicken Loans is the previous brand name of Rocket Mortgage. It has been a prominent player in the consumer lending market since its inception in 1999. As part of the Rocket Mortgage family, you can expect the same range of options, terms, and services. These encompass various mortgage types, including conventional mortgages with fixed or adjustable rates, jumbo loans, home equity loans, HELOCs (Home Equity Line of Credit), and government-insured programs such as FHA and VA loans, catering to both purchase and refinancing needs.

For conventional loans, a minimum credit score of 620 is required. The advertised APR for a 30-year fixed-rate mortgage stands at 7.199%, which may be comparatively higher than some similar offerings. However, it's worth noting that Quicken Loans operates nationwide, serving all states and Washington D.C., ensuring accessibility for a wide range of borrowers.

Change Home Mortgage

Change Home Mortgage was established in 1994. It is a mortgage broker with a focus on serving non-traditional and low-income borrowers, including immigrants and those employed on a temporary basis. This emphasis is underscored by its certification as a Community Development Financial Institution (CDFI). In addition to offering conventional options, Change Home Mortgage provides access to various government-backed loans such as FHA, VA, and USDA loans. Notably, the broker promotes an alternative to the FHA plan - a conventional loan requiring only a 3% down payment. Moreover, it offers jumbo and reverse mortgages, along with remortgaging options.

However, specific details such as interest rates, fee schedules, and borrower eligibility criteria are not publicly disclosed.

AmeriSave

AmeriSave originates from Georgia, ensuring the state consistently receives enticing offers. The lender's credibility is underscored by its exceptional ratings from BBB (A+) and Trustpilot (4.3/5).

While the advertised rate stands at 4.899%, achieving this rate typically requires a FICO score of 740 and a 20% down payment. It's important to note that your actual rate may exceed the advertised rate. For conventional loans, a credit score of 620 is required, while government-insured plans are accessible with a score as low as 600.

Average Mortgage Rate in Minnesota from 1978 to 2018

The chart shows average conventional mortgage 30-Year Fixed Rates in Minnesota.

Source: Federal Housing Finance Agency Monthly Interest Rate Survey

Information about the Housing Market and Real Estate Prices in Minnesota

Things to Consider When Choosing a Mortgage Lender

Obtaining a mortgage loan entails a significant commitment spanning 15 to 30 years, demanding careful consideration before entering into an agreement with any lender. When selecting a lending institution, several key factors merit attention. These include interest rates, loan terms, fees, reputation, customer service, and the lender's financial stability. Conducting thorough research and comparing offers from multiple lenders can empower borrowers to make informed decisions aligned with their financial goals and circumstances.

Type of Lender

Essentially, there are two popular options: banks and online mortgage lenders. Banks frequently offer attractive rates, but they tend to conduct strict credit checks. This often leads to longer approval times, and eligibility criteria can be challenging to meet. On the other hand, online lenders work much faster, and their requirements for homebuyers are generally less severe. Moreover, online lenders often provide a more streamlined application process and may offer competitive rates tailored to different financial profiles.

APR and Fees

Every loan comes with associated costs, and a mortgage is no different. Beyond the interest rate, borrowers must consider additional fees such as the origination fee, mortgage insurance fee, closing costs, and more. As of the current date, for a fixed-rate 30-year loan, the average mortgage rate in Minnesota stands at 6.58%. It's essential for borrowers to thoroughly understand and factor in all these costs when evaluating their mortgage options.

Terms and Conditions

Here, it's crucial to take into account the minimum required down payment size, which can range from 0% to 20% depending on factors such as the loan type and your current status (e.g., military, employed, self-employed, etc.). Additionally, the lifespan of the loan, representing its total length, is another important parameter to consider. Common options include 15 and 30 years. These factors significantly influence the overall cost and feasibility of the mortgage, so careful consideration is necessary when making decisions.

What Mortgage Lender is the Number One in Minnesota?

The list of reliable MN mortgage lenders is extensive, so it's hard to give an unambiguous answer to this question. Everything depends. For example, one of the industry leaders is Rocket Mortgage with a loan volume of $11.5 billion for the year 2021. To take your pick wisely, check our list of recommended lenders.

First-Time Homebuyer Programs in Minnesota

Buying a home for the first time poses considerable challenges. Fortunately, residents of Minnesota can tap into various government programs aimed at enhancing mortgage affordability.

1. The Federal Housing Administration (FHA) loan program offers insurance from the federal government to buyers. The insurance fee is incorporated into the total loan cost. In return, homebuyers benefit from a low interest rate and minimal credit requirements. With this program, individuals with a FICO score as low as 500 and a debt-to-income ratio of just 50% can qualify.
2. The USDA loan program targets those residing in rural areas. Participants in this program can secure a mortgage loan with a zero down payment. However, their annual income must not exceed 115% of the average income in the region.
3. The VA loan programs are insured by the Department of Veterans Affairs, making this mortgage option accessible to former military personnel or their spouses.

Pre-Approval: What Does It Mean?

Preliminary approval is a sort of confirmation of a prospective homebuyer’s credibility. It lets home sellers know that lenders are ready to approve a mortgage loan to the buyer. To get a pre-approval one needs to provide documentary evidence of his paying capacity. A typical document set includes earning statements, account statements, a W2 form, or an alternative proof of income for at least 2 years. Additionally, it’s necessary to fill in the Uniform Residential Loan Application form.