Best Maryland Mortgage Lenders of 2024

Whether you're buying a home in Maryland because you are a fishing enthusiast, work in D.C., or simply want to be near family, you may need a mortgage. Finding the right mortgage can be tricky, though. Here's a look at some of the best mortgage lenders in Maryland, as well as tips on how to get approved for a home loan.

How do I choose the best mortgage lender for me?

The sign of a good mortgage is one that saves you money through the years and provides great customer service. You want a company you can call if your situation changes and you want to refinance or make some other change to your mortgage. A strong lender offers more than savings. Here are some other traits to look for:

• A lender that's happy to explain the loan process to you
• A lender that's transparent, letting you know the total amount you'll pay
• A lender that answers your questions in a timely manner
• A lender that offers both a low interest rate and minimal fees

How do I get approved for a home loan in Maryland?

Some find the approval process stressful. You can minimize the stress by following these steps.

1. Order a free copy of your credit reports. Once a year, you're entitled to a free copy from each of the "Big Three" credit reporting agencies -- Equifax, TransUnion, and Experian. Order all three online through annualcreditreport.com. Once you receive them, go over each with a fine-tooth comb, looking for mistakes. If you find a mistake, dispute it with the credit reporting agency in question. The idea is to make sure your credit reports are as accurate as possible.
2. If your credit score is low, take steps to boost it before applying for a mortgage. It may take a while, but a higher credit score can save you thousands of dollars over the life of the loan.
3. Gather all needed documents in one place. That way, when a lender asks to see your last tax return or W-2s for the last two years, you won't have to waste time digging for them. While you're getting your records together, make a list of your outstanding debts. Part of the approval process involves comparing how many debts you carry relative to your income.
4. Shop mortgage lenders. If you're worried that checking around will harm your credit score, you have nothing to worry about. While your credit score will be dinged a bit by a hard credit inquiry, as long as you do all loan shopping within a two-week period, all inquiries are lumped together as one hard check. A few payments made on time should return your credit score to its previous level (or higher).
5. Provide lenders with any documents requested in a timely manner. The faster you get supporting documents to the lender, the faster the lender can process your application.
6. Once you've been approved, compare offers. Look at everything, from the APR to the fees each lender charges. The best rate does not tell the entire story. It's only by comparing rates and fees that you can determine the best mortgage lender for you.

What credit score do I need for a mortgage in Maryland?

Depending on the type of loan, it's possible to be approved for a Maryland mortgage with a credit score as low as 580 to 620. The important thing to know about being approved for a loan with the lowest possible score is that you will have to pay a higher interest rate than you would pay if your score was higher. One solution may be to take some time to build your credit score before applying.

How much is a down payment for a home in Maryland?

The amount of down payment required depends entirely on the type of loan you take out. For example, a VA loan requires 0% down, and an FHA loan requires a minimum of 3.5% down. Buyers who put 20% or more down on a mortgage loan are not required to pay monthly mortgage insurance. Mortgage insurance is a fee you pay to the mortgage company. The lender uses the fee to purchase insurance from a third party. That way, if you default on your loan, the lender can recoup the loss.

What home-buyer programs does Maryland offer?

The Maryland Mortgage Program offers a range of programs, including:

• 1st Time Advantage: Provides first-time buyers with the lowest rate available on a 30-year fixed-rate mortgage.
• Flex Loan: A 30-year fixed-rate loan that comes with additional funds for down payment and closing. The assistance is available in the form of a deferred loan, no-interest loan, or outright grant.
• Partner Match: A no-interest deferred loan that is used to cover down payment and closing costs.

And then there are specialty loans, like:

• Homeownership Program VI: Available to borrowers in Montgomery County.
• HomeAbility: Provides financial assistance to home buyers with a disability.
• Maryland SmartBuy: Available to home buyers carrying eligible student loan debt.

What else do I need to know about buying a home in Maryland?

Given today's Maryland mortgage rates, it's a tempting time to buy a home. But before you head out to house hunt, run the numbers to learn how much you can afford. Once you know how much you're comfortable spending, stick to your budget. There are few things more uncomfortable than living paycheck to paycheck because of a mortgage payment.

If the current market pushes you beyond your comfort zone, it's okay to wait. Waiting it out means more time to gather a larger down payment and to choose the lender that best fits your needs.

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