8 Best Mortgage Lenders for First Time Home Buyers in New Mexico for 2024 • Benzinga

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Are you preparing to buy your first home in the Land of Enchantment? New Mexico is a great state to call home, but you may have some questions about finding the best mortgage lender. We’ll walk you through the steps.

Quick Look: Best Mortgage Lenders for First Time Home Buyers in New Mexico

8 Best Mortgage Lenders in New Mexico for First Time Home Buyers

Now that you know the different mortgage options and first time homebuyer programs available to you, it’s time to find your mortgage lender. To help, we’ve compiled a list of the top lenders in New Mexico, grouped into 8 categories.

1. Best for Bank Statement Loans: Angel Oak Mortgage Solutions

Angel Oak Mortgage Solutions is a full-service mortgage lender offering traditional and portfolio mortgage loans. Among their many customized loan solutions is their Bank Statement product for self-employed borrowers in New Mexico. This loan does not require tax returns and includes a 1099 Income option for 1099 earners. 

  • Loan amounts up to $3 million
  • 12 or 24 months personal or business bank statements
  • Two years out of bankruptcy, short sale, foreclosure, or deed-in-lieu
  • Owner occupied, non-owner occupied, second homes in New Mexico
  • 1099 option available
  • 40-year fixed interest only
  • Delayed financing available
  • Non-warrantable condos allowed

Angel Oak Mortgage Solutions offers a wide range of loan options allowing you to obtain any mortgage as long as qualification requirements are met. New Mexico residents can also refinance into any of these loans. The customer service team is easy to reach via email, phone or the online contact form, and you can begin your journey by searching for a local advisor right on the website.

Angel Oak is headquartered in Atlanta, Georgia and is licensed in AL, AZ #0927070, licensed by the Department of Financial Protection and Innovation under the California Residential Mortgage Lending Act, CO, CT, DE, DC, FL, GA #32379, ID, IL, IN, IA, KS, KY, LA, ME, MD, MI, MN, MS, NV, NH, licensed by the N.J. Department of Banking and Insurance, NM, NC, OH, OK, OR, PA, Rhode Island Licensed Lender, SC, TN, TX, UT, VT, VA, WA dba AOHL LLC, WI.

  • Asset qualifier home loans
  • ITIN home loans
  • Investor home loans
  • Bank statement loans not available for all buyer types

2. Best for Online Loans Rocket Mortgage®

Rocket Mortgage®, powered by Quicken Loans®, makes it easy to quickly and painlessly apply online for a first time homebuyer loan.

In a matter of minutes, Rocket Mortgage® makes mortgage suggestions and quickly allows you to see what you qualify for. Rocket Mortgage® also has around-the-clock customer service ready to answer your questions.

Loan types offered: Conventional, FHA, USDA and VA

Credit score requirement: 620

  • Locked rate for up to 90 days on certain loan types, so you have time to shop for a home.
  • Work with loan officers by phone if you prefer
  • $1,000 closing guarantee with Verified Approval 
  • Rocket Rewards program means you can earn closing cost discounts by learning about the mortgage process
  • Get 1% of your down payment through the ONE+ if you qualify
  • Possible higher closing costs
  • No down payment or closing cost assistance 
  • No USDA loans
  • No physical branches 
  • No stated preapproval or closing timelines

3. Best for Low-Income Buyers: CitiBank Mortgage

If you can’t afford a large down payment and want a lender who provides down payment assistance options, CitiBank Mortgage is a top New Mexico lenders.

It offers a large variety of mortgage types for first time homebuyers to choose from, has low down payment assistance options, considers nontraditional credit and offers discounts for existing bank members.

Loan types offered: Conventional, FHA and VA

Credit score requirement: 620

  • Wide range of financial products and services offered
  • Competitive interest rates
  • Strong customer support and 24/7 assistance
  • Limited physical branch locations in some areas

4. Best for Face-to-Face Service: PNC

If you prefer working with someone one-on-one during the mortgage application process, PNC might be a good choice for you.

It offers services online and in-person, so you can get the guidance you need on the right mortgage type. This lender also takes nontraditional credit (like on-time utility payments) into consideration when qualifying you.

Loan types offered: Conventional, FHA, USDA and VA

Credit score requirement: 620–700

  • Low-down-payment loan options
  • Excellent customer service reviews
  • A+ BBB rating
  • Lower-than-average interest rates
  • Potentially secure a jumbo loan with a 5% down payment
  • Slow service by phone
  • Borrowers with lower credit scores might not qualify
  • Physical locations not available in every state

5. Best for Self-Employed: CrossCountry Mortgage

  • securely through CrossCountry Mortgage’s website

    securely through CrossCountry Mortgage’s website

    Best For:

    Self-employed Borrowers

    Available in: CA, CO, CT, DC, FL, GA, IL, MD, MA, MI, NH, NJ, NY, NC, OH, PA, RI, SC, TN, TX, VA, WA 

CrossCountry Mortgage makes it easy for all types of home buyers to get approved for a mortgage. Their flexible requirements can help you get financing, with no employment or income verification and no minimum DTI. CrossCountry Mortgage offers traditional loan terms, as well as more flexible mortgage payment plans with its 40-year loan program. It’s one of the best local mortgage lenders.

It’s also easier to get approved if you’re self-employed. Tax returns are not required and you’ll only need 1 year of self-employment income history and a minimum credit score of 580. CrossCountry Mortgage can also help you get approved on assets alone, like your bank statements, stocks and bonds, or retirement accounts.

  • Long-term loan programs
  • Low minimum credit score
  • No minimum DTI
  • Service not available in all 50 states

6. Best for Credit Monitoring: loanDepot

loan Depot is a non-bank lender that gives you convenience and efficiency online with the option to visit one or over 200 branches across the country. loanDepot offers fixed-rate and adjustable-rate conventional mortgages. You could also secure jumbo, FHA or VA loans, although conventional loans made up most of LoanDepot’s mortgage originations last year. LoanDepot also offers 10-, 15-, 20- and 30-year mortgage terms. 

In addition to mortgages and home refinancing, LoanDepot offers free credit score monitoring to help you prepare to apply for a mortgage. You’ll need a minimum credit score of 620 and at least 5% downpayment. 

  • Choose shorter repayment terms 
  • $1,000 Close-on-Time Guarantee
  • Possible home security, moving and smart home product discounts 
  • Use its online loan calculator to compare monthly payments and lifetime interest before deciding on a mortgage lender
  • No mortgage rates listed online
  • No USDA loans

7. Best for Borrowers with No Credit Score: Guaranteed Rate

Guaranteed Rate Companies is a major mortgage lender based in Chicago, Illinois. It offers various home loans, including conventional fixed-rate and adjustable-rate mortgages (ARMs), jumbo loans, interest-only loans, home renovation loans and government-backed FHA mortgages and VA loans. 

It also offers flexible mortgage application options and accepts non-traditional credit, like your rent or utility payment history, to qualify for a conventional or government-backed loan. With so many options, you can work with the company to find the mortgage that meets your needs. 

  • Nationwide online mortgage offerings
  • Streamlined online mortgage application
  • Get sample rates for its loan products to start comparison shopping
  • No downpayment is required for USDA or VA loans
  • Minimum downpayment of 3% for conventional and 3.5% for FHA loans
  • No home equity loans
  • No branches in Delaware, Vermont or Wyoming

8. Best for VA Loans: Veterans United

If you’ve logged some time in the military, Veterans United’s loans will likely be the best deal. Unlike other veteran-marketed loan programs, Veterans United only accepts active duty and veteran military members.

In addition to no-down-payment loans, you’ll also eliminate the private mortgage insurance you’ll have to pay with other mortgages.

Veterans United is also more forgiving of lower credit scores. Interest rates are lower than average.

  • Competitive interest rates and loan terms
  • Streamlined loan process
  • Provides educational resources and support for veterans and military members
  • Limited physical branch locations

The Housing Market in New Mexico: An Overview

Before you choose a lender, you’ll want to understand the current state of your local housing market. 

Here’s a quick overview of the New Mexico market, including median home values:

Total households: 812,852

Median list price: $288,855

3 most expensive cities in New Mexico to buy a house:

  • Corrales: $668,575
  • Los Ranchos de Albuquerque: $621,423
  • Taos: $454,642

3 most affordable cities in New Mexico to buy a house:

  • Clovis:  $137,620
  • Roswell: $156,112
  • Hobbs: $160,890

Investigate median home values to help you prepare for what you could pay on your new home, based on location.

Preparing for a Mortgage

Before starting the mortgage application process, you’ll want to have a few items ready. We’ll walk you through the application process and provide some helpful tips along the way.

First Time Home Buyer Mortgage Process in New Mexico

Before starting the home loan application process, it’s important to take a look at your finances. Knowing where you stand financially will help you decide which mortgage type and lender is right for you.

You should:

Know How Much Down Payment You Can Afford

Many types of mortgages and lenders have down payment criteria you need to meet. Knowing how much you can comfortably put down on your home will help you figure out which mortgages you’re eligible for and how low your rate is likely to be.

Know Your Credit Score

Your credit score is used to determine if you’re a creditworthy applicant. Your score also helps determine your mortgage rate. Different lenders have different criteria when it comes to credit scores. Usually the lower your rate, the lower your score.

What You’ll Need

Next, it’s time to gather the documentation you’ll need to start applying for a mortgage. Having these details ready helps save time and speeds up the mortgage process.

You should gather:

  • Your Social Security number
  • Your tax information from the past 2 years
  • Your pay stubs from the past 2 months
  • Your account totals (checking, savings, retirement and other investment accounts)

You might need to supply additional documentation, depending on your lender’s requirements. Below are popular lenders and required minimum credit scores. 

Mortgage Options

All first-time homebuyers should be aware of the different mortgage options available. To help you figure out the best mortgage type for your financial situation, we’ll walk through the 5 most common mortgages.

Conventional Loan

This type of loan is granted by banks or credit unions. Conventional loans have higher mortgage rates (interest rates) because they aren’t backed by the government. Many have low down payment options. On the upside, they’re usually easier to qualify for, since their requirements are more flexible.

FHA Loan

This type of loan is ideal for first time homebuyers and is financed through the Federal Housing Administration (FHA). FHA loans typically have below-market mortgage rates, low down payment options (3.5% minimum) and low credit score minimums (as low as 580). You can secure an FHA loan through most conventional lenders.

USDA Loan

This type of loan is financed through the U.S. Department of Agriculture and is ideal for homes being purchased in rural areas (outside of major cities) in New Mexico. USDA loans have below-market mortgage rates, no down payment requirements and low credit score minimums (as low as 640). You can secure a USDA loan through most conventional lenders.

VA Loan

This type of loan is financed through the U.S. Department of Veterans Affairs for current and former military members and their families. VA loans typically have below-market mortgage rates, no down payment requirements and no credit score minimums (unless required by a lender). You can secure a VA loan through most conventional lenders and through VA-only lenders.

Jumbo Loan

This type of loan is used to finance homes over $484,350 (the limit might be higher, depending on where you live). Jumbo loans can be conventional or FHA loans. These loans have larger down payment expectations and higher credit score requirements. Many lenders expect a minimum down payment of 20% on jumbo loans, but some lenders, like Rocket Mortgage®, only require 10% down.

First Time Home Buyer Programs in New Mexico

The New Mexico Mortgage Finance Authority (MFA) offers a variety of programs designed to help first time homebuyers like you better afford a home. Here are a few resources they offer:

FIRSTHome

This mortgage assistance program is offered to New Mexico first time homebuyers with low-to-moderate incomes. FirstHome has low-interest rates and prevents lenders from charging origination fees.

FIRSTDown

This down payment assistance program provides up to $8,000 in down payment assistance via a forgivable loan. FirstDown can only be used with a FirstHome mortgage.

HomeNow

This down payment assistance program provides up to $8,000 in down payment assistance for low-income, first time homebuyers via a forgivable loan. HomeNow must be used with a FirstHome mortgage.

Current Mortgage Rates in New Mexico

Mortgage rates refer to the interest rates of your mortgage. Since you’ll pay this rate throughout the lifetime of your loan, locking in a low mortgage rate can save you up to tens of thousands in interest.

Your lender determines your mortgage rate based on a few different factors including your credit score, down payment, mortgage type, home location and your mortgage term.

Mortgage term refers to the length of your mortgage. There are 2 types of terms: fixed and adjustable. A fixed mortgage allows you to pay a fixed amount every month for the duration of your loan. With an adjustable mortgage (ARM), you pay a fixed amount for your introductory period, after which your mortgage rate and monthly payment will fluctuate based on the local market.

Since mortgage rates in New Mexico can vary greatly from city to city, we’ve compiled median mortgage rate data based on 3 loan terms to give you a better idea of what you can expect your mortgage rate to be.

Loan Type Rate APR
30-year fixed N/A N/A
15-year fixed N/A N/A
7/1 ARM (adjustable rate) N/A N/A
5/1 ARM (adjustable rate) N/A N/A

Rates based on an average home price of $203,675 and a down payment of 20%.

Closing a Mortgage

Once you’ve found a lender and chosen a mortgage type and term, you’ll begin the closing process. Closing is the last step in the mortgage process. During closing, you’ll sign all of your loan documents and verify the terms of your mortgage. This is when your down payment and any closing costs are due.

You’ll also walk through your new home one final time to verify it’s in the condition you agreed to. From there, you’ll meet with your agent to review and sign all financial paperwork. Once this is complete and payments are made, you’ll receive the keys to your new home.

Depending on your lender, the closing process can take between 30–45 days. An online lender, like Rocket Mortgage®, can typically speed this timeline because approvals and verifications happen more quickly.

Here are typical closing day expectations based on top lenders in New Mexico.

Get Ready to Buy Your First Home in New Mexico

Buying your first home is a major monument in your life. Take your time and investigate all of your options before you commit to a mortgage lender. Focus on the incentives that are most important to you and choose a lender who is willing to make your financial dreams become a reality.

Frequently Asked Questions

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To get pre-approved for a mortgage in New Mexico, 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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Interest that you will pay in New Mexico 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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Most lenders in New Mexico 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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