What goes into our editorial rating for home loan providers.
When weighing whether or not to take on a home loan, finding similar information to compare can be tricky. Many lenders aren’t up front about interest, fees and terms. And hunting for important information — like whether you’re allowed to buy points to lower your interest rate — can take some digging.
Our loan rating system is designed to help you compare a lender’s overall performance, not just the numbers. When rating a mortgage, our researchers consider APRs, loan amounts and terms as well as customer reviews, the application process and other factors that play into a decision.
It’s meant to provide you with a simple starting point. But what’s good for other borrowers might not be the best option for your needs. Read our comprehensive provider reviews before applying for a loan.
We rate loans using a system of one to five stars.
★★★★★ — Excellent
★★★★★ — Good
★★★★★ — Average
★★★★★ — Subpar
★★★★★ — Poor
How we rate interest rates and fees
When we look at a loan’s interest rate and fees — commonly expressed as the annual percentage rate (APR) — we consider both the highest and lowest APRs.
In addition to APR, we also consider the fees a lender charges. Charging “junk” fees, like a commitment fee, an application fee or a rate-lock fee, can hurt a lender’s rating. Further hurting its score is failing to offer a grace period before charging late or insufficient funds fees.
How we rate customer reviews
We base our customer review rating on a lender’s Trustpilot and Better Business Bureau (BBB) pages.
With Trustpilot, we consider the lender’s overall score and the percentage of users who give the lender an “Excellent” rating.
With the BBB, we consider its BBB rating, whether it’s accredited by the organization, its percentage of positive reviews and the number of customer complaints. Government actions filed against a lender can negatively affect its rating.
We also look at the number of users who’ve reviewed the lender. For instance, a 9 out of 10 Trustpilot score based on 20 reviews isn’t weighed as heavily as the same rating based on 11,000. If a provider doesn’t have a Trustpilot or BBB page, that can also hurt its score.
How we rate borrower experience
We look at benefits or perks that might improve a borrower’s overall experience when applying for and repaying the loan. For example, we consider whether a lender shares their interest rates and fees upfront.
We like perks that include free rate locks, online support, no prepayment penalty and special mortgage programs . A wide selection of mortgage and payment options can further boost a lender’s score.