Best Mortgage Lenders for First-Time Homebuyers in May 2026

With elevated interest rates, limiting housing stock and existing owners staying put, buying a house has never been more challenging.

First-time buyers need flexible down payment options, generous grants and excellent customer service.

CNBC Select has chosen the best mortgage lenders for new buyers across various categories, including borrowers with poor credit, military families and buyers looking to close quickly.

For more information on how we made our selections, see our methodology.

Who’s this for? You can put 1% down with the ONE+ loan by Rocket Mortgage. You won’t have to pay for private mortgage insurance with this product, making it an excellent option for qualifying first-time homebuyers who haven’t saved up much for a down payment.

Standout benefits: If you purchase your house through the Rocket Homes network, you may be eligible for a 1.25% rebate on closing costs, up to $10,000.

Who’s this for? Chase guarantees eligible mortgages will close on time, or borrowers get a $5,000 cash payment.

Standout benefits: Chase’s Standard Agency mortgage allows first-time buyers to put down as little as 3%. Current Chase customers may qualify for a discount on their mortgage rate.

Who’s this for? Guild Mortgage has more flexible credit requirements than many competitors, especially for FHA loans and other government-backed mortgages. It also considers non-traditional credit sources, like on-time rent and utility payments.

Standout benefits: Guild’s Payment Advantage mortgage pays 1% of your interest rate for the first year. If rates go down, you may be eligible to refinance with no lender fees. Guild also offers a 17-day closing guarantee, with qualified buyers receiving a $500 closing-cost credit if they fail to close on time.

Who’s this for? The largest issuer of VA loans in the U.S., Veterans United specializes in lending to active-duty service members, veterans, eligible reservists and surviving spouses.

Standout benefits: The Veterans United customer service team is available 24/7, making it easier for troops stationed overseas to access. Free credit counseling is also available to help you get approved for the best rate.

Who’s this for? Flagstar Bank‘s Gift Program enables first-time homebuyers in certain Community Reinvestment Act (CRA) Assessment areas to receive grants and gifts covering up to 3% of their purchase price, with a maximum value of $10,000.

Standout benefits: Through the Flagstar Power-Up program, first-time buyers in select low-to-moderate income census tracts can receive up to $8,000.

Who’s this for? PNC Bank‘s conventional fixed-rate mortgages have terms ranging from 10 to 30 years. There’s no minimum loan amount and PNC approves jumbo mortgages for up to $5 million, higher than many competitors.

Standout benefits: PNC Bank offers a closing cost grant of up to $7,500 to qualifying first-time homebuyers. Eligible borrowers can qualify for a PNC Community Loan with a 3% down payment and no private mortgage insurance.

Who’s this for? Better Mortgage offers a discount of up to $2,000 on closing costs for those who use Better Real Estate to buy their home.

Standout benefits: With Better’s HOPE Grant, homebuyers who meet income requirements can receive 2% of their home’s value, up to $5,000, toward their down payment.

Who’s this for? J.D. Power ranks Bank of America highly for both mortgage origination and servicing and it received an A+ from the Better Business Bureau.

Standout benefits: BoA’s Down Payment Grant provides up to 3% of a home’s purchase price in select markets, while America’s Home Grant offers up to $7,500 toward closing costs.

The U.S. Department of Housing and Urban Development (HUD) considers you a first-time homebuyer if you meet any of these criteria:

• You’ve never owned a house.
• You haven’t owned a principal residence within three years of the closing date on a new home.
• You have only owned a home jointly with a spouse from whom you’re now divorced, or a widow, and no longer own the property.
• You only owned a house that was not permanently affixed to a foundation, such as a mobile home.
• You’ve only owned a home that did not meet building codes and could not be brought up to code for less than the cost of constructing a new home.

Most mortgage lenders and government agencies adhere to this broad definition. Some FTHB grant programs may impose additional restrictions on income and location.

Check your credit. Your credit score will tell you what loans and rates you qualify for. While a 620 is the typical threshold for a conventional mortgage, a 740 or higher unlocks the best rates. If you don’t have great credit, you may want to look at lenders that offer FHA loans, which only require a 500.

Compare multiple lenders. Get quotes from at least three to five lenders, including banks, credit unions, and online lenders. Compare the APRs, terms, closing costs, discounts and other features of their offers, and ask about down payment assistance and other homebuying programs.

Try to get preapproval, so you have a solid idea of your borrowing limit.

Evaluate other services and features. Taking out a mortgage is the beginning of a long relationship. Make sure you’ll get the level of service you need. Are there agents available 24 hours a day? Do they sell their loans to third-party servicers? Has there been a high number of complaints, lawsuits or judgments? Ask for referrals, read reviews and check the Consumer Financial Protection Bureau website for enforcement actions.

In 2025, the median down payment for first-time homebuyers was 10% — the highest median since 1989, according to the National Association of Realtors.

Here’s the minimum down payment lenders typically require for common mortgage types.

• Conventional mortgages: This is the most common type of mortgage and lenders usually require a minimum of 5% down. You’ll have to pay private mortgage insurance until you reach 20% equity.
• Department of Veterans Affairs loans and U.S. Department of Agriculture loans: No down payment is required because the financing is backed by the federal government.
• Federal Housing Administration loans: You must put at least 3.5% down.
• Community lending mortgages: Most private lenders offer community lending mortgages designed for low- and middle-income buyers, which typically have flexible down payment requirements.
• Proprietary first-time homebuyer mortgages: Chase’s DreaMaker loan requires just 3% down, while Rocket Mortgage’s RocketONE+ loan accepts as little as 1%.

State and federal government agencies, private lenders and non-profits all sponsor programs that help first-time buyers and others achieve homeownership.

Many are grants that can be used toward closing costs or a down payment and come with income or location requirements.

• Bank of America‘s Down Payment Grant provides 3% of a house’s purchase price, up to $10,000, in select markets.

• PNC Bank has a $5,000 grant for low-income borrowers that can be put toward closing costs, a down payment or other prepaid costs.

• Wells Fargo‘s Homebuyer Access grant provides up to $10,000 toward a down payment for buyers who make no more than 120% of the median income.

To determine which mortgage lenders are the best for first-time homebuyers, CNBC Select analyzed dozens of U.S. mortgage lenders. We focused on the following features:

Loan types: We weighed lenders more heavily if they offered government-backed FHA, VA and USDA loans, jumbo mortgages and specialty loans aimed at low-income borrowers

Minimum down payment: We noted which lenders offered loans with lower minimum down payment requirements or down payment assistance. 

Credit scores: We gave lenders more weight if they offered loan options to borrowers with lower credit scores or no credit history.

Fees: The mortgage process includes origination, application and underwriting fees, as well as charges for appraisals, title insurance, attorneys and other closing costs. We noted if a lender had lower fees, discounts or waived certain fees.

Application process: We evaluated whether lenders offered an online preapproval and application process, as well as whether they had physical branches for an in-person experience. 

Customer service: Lenders ranked highly on J.D. Power’s mortgage origination and servicing surveys were given greater weight. We noted whether a lender had robust customer service phone hours and a website with an online chat feature and educational resources.

We also considered CNBC Select audience data when available, such as general demographics and engagement with our content and tools.

Based on those criteria, our selections for the best mortgage lenders for first-time homebuyers are:   

Catch up on CNBC Select’s in-depth coverage of credit cards, banking and money, and follow us on TikTok, Facebook, Instagram and Twitter to stay up to date.