Best Florida Mortgage Lenders for First-Time Home Buyers • Benzinga

There’s no place quite like Florida. With its mild winters, miles of beaches and unique attractions like Walt Disney World, the Sunshine State has a little something for everyone. As a first-time homebuyer, Florida has a variety of homes and lenders to choose from. Let’s take a closer look at Florida’s housing market, how to prepare for a mortgage and the best mortgage lenders for first-time buyers. 

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The Best Mortgage Lenders in Florida are:

The Housing Market in Florida: An Overview

Getting a sense of the Florida housing market can help you know what to expect when you start shopping for a home. Different cities, and even different neighborhoods within a city, will have different price points, so keep that in mind as you look for your new home. 

Here’s some quick Florida facts: 

Total households: 6,337,929

Median list price: $250,000

3 most expensive cities in Florida to buy a house:

  • Miami
  • Manalapan
  • Key Biscayne

3 most affordable cities in Florida to buy a house:

  • Kissimmee
  • Palm Coast
  • Cape Coral

Preparing for a Mortgage

The mortgage process may seem mysterious. You can help keep the process moving by being prepared. Here’s how the process works:

  1. Review your credit. Your credit history and credit score play a significant role in the mortgage process. Lenders have a minimum credit score requirement. If you don’t meet the minimum, you may need to improve before you can qualify for a mortgage. Before you apply for a mortgage, get a free copy of your credit reports. Review it for errors and areas for improvement. 
  2. Gather your documents. You can simplify things by having all your documents ready before you apply. Every lender will have different requirements, but in general you will need to provide the following documents:
    • W2s for the past year
    • Tax returns for the past 2 years
    • Pay stubs from the past 2 months
    • Bank statements from the past 2 months
    • Investment and retirement account statements from the past 2 months
    • The most recent statement for all your debt payments 
    • A copy of your driver’s license
  3. Get preapproved. Contact lenders and let them know you’re starting your home search process. Ask for a quote. Review the quotes and choose a lender and complete the lender’s preapproval process.  
  4. Find a home. An experienced real estate agent can help you find a home that fits your budget. Base your budget on how much your lender preapproved for you. 
  5. Make an offer. Your agent will assist you in making an offer. 
  6. Complete a loan application. Your lender will have you complete an application. The lender’s underwriting department will review your application. 
  7. Complete underwriting. Your lender may ask questions or need additional documents during underwriting. Provide documents promptly to keep things moving. Your lender will let you know if it has approved you at the end of underwriting. 
  8. Close on your home. You will need to sign documents and pay your closing costs. After that, you can move into your new home. 

Everyone runs into bumps during the mortgage process, so don’t panic. Respond to your lender promptly and ask questions if you need clarification. Here are the minimum credit scores required by some Florida lenders:

Mortgage Options

As a first-time homebuyer, you’ll have several mortgage options to choose from when you get a purchase quote. Here’s a closer look at the most common mortgage options:

  • Conventional: A conventional mortgage is a mortgage that is not insured by a federal government agency. These mortgages typically require a higher credit score than FHA, USDA and VA mortgages. Mortgages can be fixed-rate, where the interest rate stays the same for the entire loan term, or adjustable-rate, where an interest rate changes on a schedule established by your lender. Adjustable-rate mortgages often have an introductory fixed-rate period. 
  • FHA: You can get an FHA mortgage through an FHA-approved lender. The Federal Housing Administration insures these loans, which lenders can offer them to a wider range of home buyers. If you have a credit score of 580 or higher, you can make a down payment as low as 3.5%. If your credit score is 500–579, you may still qualify for an FHA mortgage if you make a 10% down payment. 
  • USDA: The U.S. Department of Agriculture backs loans to help low- to moderate-income borrowers purchase homes in rural areas, including many areas of Florida. These mortgages are available with no minimum down payment.
  • VA: The Veterans Administration backs VA loans. Current service members and veterans, along with some qualifying spouses, can obtain a low-interest mortgage with no minimum down payment. You have to meet the VA’s minimum service requirements to qualify. 
  • Jumbo: A jumbo mortgage is a type of conventional mortgage for higher-priced properties. Some conventional mortgages are conforming, which means Fannie Mae and Freddie Mac guarantee them. These organizations are government-sponsored but are private companies. Conforming conventional mortgages have limits set by the FHA. Jumbo mortgages are non-conforming, which means they are higher than the conforming limits. 

The bottom line is that FHA, USDA and VA mortgages are all insured by government agencies but offered through private, approved lenders. Private lenders offer conventional and jumbo mortgages. 

First-Time Home Buyer Programs in Florida

Buying your first home isn’t easy. It can be a challenge to come up with that initial down payment and the process can seem like a mystery. Florida offers programs that can help:  

  • Florida Housing First-Time Homebuyer Program: This program offers 30-year fixed-rate mortgages to first-time home buyers who qualify based on income. To find out if you qualify, Florida Housing recommends you contact an approved lender. You can find one in your area by visiting its website
  • Florida Housing Down Payment Assistance: Florida Housing offers down payment and closing cost assistance in the form of a 2nd mortgage. This assistance is only available in conjunction with a Florida Housing mortgage. 
  • Florida Housing Mortgage Credit Certificate: First-time home buyers may also be eligible for a tax credit. The credit is based on a percentage of the mortgage interest you pay up to a limit of $2,000. This credit directly lowers the amount of federal taxes you owe. To qualify, you must meet purchase price and income requirements, which you can find out by talking to an approved lender

Current Mortgage Rates in Florida

Florida mortgage rates, the amount of interest you pay on your mortgage, are currently slightly lower than national average rates. 

Mortgage rates change daily based on market conditions. At Benzinga, we update mortgage rates regularly to reflect these changes. Here are the mortgage rates for common types of mortgages:

Loan Type Current Mortgage Rate
30-year fixed 3.63%
15-year fixed 3.19%
5/1 ARM (adjustable rate) 3.63%

Closing a Mortgage

As you consider the best lenders for first-time buyers, keep an eye on their closing rate. Closing is when you’ve reached the end of the mortgage process. At that point, your lender has approved your loan, the appraisal is done and your lender is ready to fund your loan.

All you need to do is sign the paperwork and get the keys. Some lenders handle this process more quickly than others. Here are the average closing rates from popular Florida lenders. 

5 Best Mortgage Lenders in Florida for First-Time Buyers

You should get quotes from multiple lenders to ensure you get the best rates. To help you get started, here are the 5 best mortgage companies in Florida for first-time buyers, all of which have been researched extensively by Benzinga:

1. Best Overall: Quicken Loans

Quicken Loans offers a wealth of educational resources, which are essential for a first-time buyer. When you combine that with its award-winning customer service, you know you’ll be taken care of every step of the way.

Quicken Loans also offers a wide range of mortgages, including conventional, jumbo, FHA, VA and USDA. This means Quicken Loans can work with you to find the best loan for your needs. 

2. Best for Low Credit Score: Caliber Home Loans

Caliber Home Loans offers a customer-oriented experience and it focuses exclusively on mortgages.

It offers government-backed and conventional mortgages. What’s really promising, though, is Caliber’s portfolio products, which are for borrowers who have experienced financial challenges, are self-employed or who have a low credit score.

Caliber has branches throughout Florida so you can talk to someone in person.  

3. Best for an Online Experience: Guaranteed Rate

If you want to avoid trips to a branch office, Guaranteed Rate offers an entirely online experience. It still offers excellent customer service, though, so you can easily get the assistance you need.

Guaranteed Rate offers a wide range of mortgage products and works with borrowers who can only make a small down payment. 

4. Best for On-Time Closing: New American Funding

As a first-time homebuyer, you might not realize that the mortgage underwriting process can sometimes drag on.

New American Funding avoids that by offering an On-Time Closing guarantee.

There are conditions, but in general, as long as you get your required documents on time, New American Funding will have your mortgage ready for closing within 30 days. 

5. Best for In-Person Service: Bank of America

Although Bank of America is a national bank, it offers in-person service, which many first-time homebuyers prefer.

It also offers down payment and closing costs assistance programs, which could help you get into your first home. Bank of America has branches throughout Florida, so you’re never far away if you need assistance. 

Finding Your First Florida Home

Although the home buying process can feel rushed, take the time to evaluate your options. Sure, you can get a refinance quote down the road if you need to, but find the best mortgage you can by contacting multiple lenders. Even a small difference in interest rates can save you thousands of dollars over the life of your mortgage.

The same goes for real estate agents — you may need to interview more than one before you find the right one. Take your time and trust your instincts, and you’ll find the home that’s right for you. 

Frequently Asked Questions

1) Q: How do I get pre-approved?

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1) Q: How do I get pre-approved?

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Melinda Sineriz

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First, you need to fill out an application and submit it to the lender of your choice. For the application you need 2 previous years of tax returns including your W-2’s, your pay stub for past month, 2 months worth of bank statements and the lender will run your credit report. Once the application is submitted and processed it takes anywhere from 2-7 days to be approved or denied. Check out our top lenders and lock in your rate today!

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Benzinga

2) Q: How much interest will I pay?

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2) Q: How much interest will I pay?

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Melinda Sineriz

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Interest that you will pay is based on the interest rate that you received at the time of loan origination, how much you borrowed and the term of the loan. If you borrow $208,800 at 3.62% then over the course of a 30-year loan you will pay $133,793.14 in interest, assuming you make the monthly payment of $951.65. For a purchase mortgage rate get a quote here. If you are looking to refinance you can get started quickly here.

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Benzinga

3) Q: How much should I save for a down payment?

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3) Q: How much should I save for a down payment?

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Melinda Sineriz

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Most lenders will recommend that you save at least 20% of the cost of the home for a down payment. It is wise to save at least 20% because the more you put down, the lower your monthly payment will be and ultimately you will save on interest costs as well. In the event that you are unable to save 20% there are several home buyer programs and assistance, especially for first-time buyers. Check out the lenders that specialize in making the home buying experience a breeze.

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Benzinga