What’s A Good Credit Score To Buy A House?

8 Min Read
Updated Feb. 23, 2024
Written By
Miranda Crace
Family moving into new home.

Credit scores can be a confusing topic for even the most financially savvy consumers. Most people understand that a good credit score boosts your chances of qualifying for a mortgage because it shows the lender you’re likely to repay your loan on time. That’s why many lenders require minimum credit scores for loans.

But do you know the minimum credit score you need to qualify for a mortgage to buy a house? And did you know the minimum credit score to qualify can vary depending on the mortgage you want?

To buy a house with a conventional loan, for example, you’ll need at least a 620 credit score. But don’t worry. Even if your credit score hovers somewhere in the 500 – 600 range, you can still secure a home loan.

While every lender is different, knowing your score and how it may impact your loan application is key.

Home Buyer’s Guide

Home Buyer’s Guide

Follow our step-by-step guide to learn how to buy a home.

What Credit Score Is Needed To Buy A House?

The minimum credit score you need to qualify for a mortgage depends on the type of home loan you’re trying to obtain.

Type Of Loan

Minimum FICO® Score

Conventional loan

620 (Federal Housing Financing Agency requirement)

Federal Housing Administration (FHA) loan with a 3.5% down payment

580 (FHA requirement)

FHA loan with a 10% down payment

500 (FHA requirement)

Department of Veterans Affairs (VA) loan

No VA minimum requirement. Most lenders require a 580 credit score or higher.

U.S. Department of Agriculture (USDA) loan

No USDA minimum requirement. Most lenders require a 640 credit score or higher.

Jumbo loan

Most lenders require a 680 credit score or higher.

Conventional Loans

Conventional mortgages are home loans that follow the standards set by Fannie Mae and Freddie Mac. They typically offer competitive interest rates and flexible mortgage repayment terms that range from 8 to 30 years. Conventional loan financing is typically best for borrowers with good or excellent credit because they require a higher credit score than government-backed loans.

To secure a conventional loan to buy a house, most lenders typically require a minimum credit score of 620. However, the final decision on what works as a qualifying credit score will rest with the lender. Some lenders will let you buy a home with a 620 credit score, and others may require a higher minimum credit score.

FHA Loans

The Federal Housing Administration insures FHA home loans. Lenders are more willing to approve borrowers who would have struggled to meet conventional mortgage requirements because the loans are insured by the FHA.

With down payments as low as 3.5%, FHA loans help prospective home buyers with lower credit scores and smaller amounts saved to make a down payment.

To qualify for an FHA loan that requires a 3.5% down payment, you’ll need a minimum credit score of 580. If you can make at least a 10% down payment, you may qualify for an FHA loan with a 500 credit score.

Keep in mind that FHA loans are issued by private lenders, and lenders may set minimum credit score requirements.

VA Loans

A VA home loan, insured by the Department of Veterans Affairs, may assist your homeowning aspirations. VA loans don’t require a down payment, and they’re available to borrowers with lower credit scores.

To qualify, you must be an eligible member or veteran of the U.S. armed forces, a member or veteran of the U.S. Army Reserves or National Guard or a surviving spouse to apply for a VA loan.

The VA has no minimum credit requirement, but many lenders require borrowers to have a minimum credit score of at least 580.

USDA Loans

The U.S. Department of Agriculture offers USDA home loans to promote rural development. To qualify for this type of mortgage, you must purchase a single-family residence in an eligible rural location. And your household income can’t be more than 115% of the area’s median household income.

The USDA doesn’t set a minimum credit score requirement for home buyers, but lenders can require one. Many lenders require a credit score of 640 or higher for initial approval. However, depending on the situation, you may be approved with a lower credit score.

Jumbo Loans

A jumbo loan is similar to a conventional mortgage, except the loan amount for a jumbo loan exceeds the conforming limits set by the Federal Housing Finance Agency (FHFA).

To be approved for a jumbo loan, borrowers typically need a low debt-to-income ratio, a high credit score and a substantial amount of cash reserves.

Since jumbo mortgages allow a high loan amount, lenders can be stricter about their minimum credit score requirements. For example, you may need a 740 credit score if you choose a fixed or adjustable-rate 15-year jumbo loan. But you may qualify for a 30-year fixed-rate jumbo loan with a 680 credit score.

See What You Qualify For

Factors That Go Into A Credit Score

It’s important to know your credit score and understand what affects it before you begin the mortgage process. Once you know how it all works together, you can build your credit score or maintain it to give yourself the best chance of qualifying for a mortgage.

While exact scoring models may vary by lender, some variation of the standard FICO® Score is often used as a base. FICO® pulls variables from the three major credit bureaus (Equifax®, Experian™ and TransUnion®) from your credit reports and compiles your score. FICO® Scores range from 300 – 850 and are based on:

  • Payment history
  • Amount owed
  • Length of credit history
  • Types of credit
  • New credit

The higher your score, the easier it should be to qualify for a lower interest rate on a great mortgage.

Additional Factors Lenders Consider For A Mortgage

Your credit score is a key factor in determining whether you qualify for a mortgage. But it’s not the only factor lenders consider. Your mortgage lender will also evaluate your:

  • Income: Lenders verify your income before approving you for a mortgage. They want to make sure you make enough money each month to afford all your payments.
  • Debt-to-income ratio (DTI): Depending on the type of mortgage you use, lenders want your total monthly debts, including your new estimated mortgage payment, to apply to no more than 50% of your gross monthly income. If your debt-to-income ratio is higher, you may struggle to qualify for a mortgage.
  • Down payment: The bigger your down payment, the more likely it is that you’ll qualify for a mortgage with a lower interest rate. That’s because lenders believe borrowers are more likely to make regular payments after investing a significant amount of their money into the loan.
  • Savings: Lenders want to make sure you have reserve funds to continue to make your mortgage payments if your income unexpectedly dries While not all lenders require it, some lenders may require borrowers to have a reserve fund of 1­ – 12 months of mortgage payments saved depending on the terms of the loan and the type of mortgage.
  • Employment history: Lender requirements may vary, but they usually want to see that you’ve worked at the same job or industry for at least 2 years.

Take the first step toward the right mortgage.

See what you can afford.

How To Improve Your Credit Score Before Buying A House

Fortunately, credit scores aren’t static – you can improve them. Be aware, though, that there are no quick fixes. It takes time to build up a low credit score.

Take these steps to help boost your credit score before filling out a mortgage application:

  • Check your credit report for errors: Order one copy of each of your three credit reports (maintained by Experian®, Equifax™ and TransUnion®) each year from AnnualCreditReport.com. Once you get the reports, check them for errors.
  • Become an authorized user: A family member may help you boost your credit score by adding you as an authorized user to a credit card account. Don’t run up debt on this card, though. If you do, you can hurt your family member’s credit score.
  • Pay your bills on time: Paying your bills on time each month is the surest way to steadily improve your credit score.
  • Pay down your credit card debt: Paying down credit card debt is another way to steadily improve your score. But don’t close the credit card account once you pay it off.

What’s A Good Credit Score To Buy A House: FAQs

If you have additional questions about the best credit score to buy a house, we have answers.

The lowest credit score that will qualify you for a mortgage depends on the type of home loan you use and the lender’s requirements.
For a conventional mortgage, the typical minimum credit score is 620, but you may be able to secure financing with a lower credit score.

You may qualify for a mortgage with a low credit score. However, your lender may charge a higher interest rate, and the underwriting process may be more involved. If you’re trying to buy a home with a low credit score, making a larger down payment or recruiting a co-borrower can help.

Your credit score not only qualifies you for a mortgage. It also helps to determine your interest rate and loan terms. Taking the time to improve your score can help you land a better interest rate and a longer repayment term. Fixing a credit score takes time. You should be cautious if anyone offers to improve your credit score overnight.

The Bottom Line

The credit score required to buy a home may differ based on the type of loan you’re applying for. But, no matter what type of financing you’re thinking about, the higher your credit score is, the easier it should be to get a better interest rate on your mortgage. 

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