There is no single credit score required to buy a house. A score near 620 is a common benchmark for some conventional loans, while FHA and other government-backed programs may allow lower scores. Your options depend on the loan program, lender requirements and your overall financial profile.
Credit is an important part of qualifying for a mortgage, but lenders consider more than a number. Your income, monthly debts, available funds and recent payment history can also affect your loan options.
What's in this article?
Understanding how lenders evaluate credit can help you identify realistic next steps before you begin shopping for a home.
What credit score do you need for each type of mortgage?
Among the commonly available mortgage loans, the guidelines for credit scores vary significantly between conventional, FHA, VA and USDA loans. (FHA denotes Federal Housing Administration, VA is the common term for the U.S. Department of Veterans Affairs and USDA represents the U.S. Department of Agriculture.)
The following table provides general guidance rather than a promise of qualification:
| Loan type | General credit-score guidance | What to know |
| Conventional | Eligibility depends on underwriting, loan features, borrower profile and any additional lender requirements | Automated underwriting systems may evaluate the complete application without one universal minimum |
| FHA | A score of at least 580 may permit maximum FHA financing | Scores from 500 to 579 are generally limited to 90% loan-to-value financing |
| VA | VA does not establish a universal minimum score | Individual lenders review credit history and may set their own requirements |
| USDA | USDA does not use one minimum score for every application | Credit history, income, property eligibility and underwriting results all have influence |
These are general program guidelines, not guarantees of approval. A lender may apply additional requirements based on the underwriting results and the borrower’s full financial profile.
Ready To Take Your Next Step?
Is 620 the minimum credit score to buy a house?
No. A 620 score is a useful conventional mortgage reference point, but it is not the minimum for every home loan.
Mortgage requirements can depend on:
- Whether the loan receives automated or manual underwriting
- The mortgage program
- The property and occupancy type
- The borrower’s complete credit history
- Additional standards established by the lender
An additional lender requirement beyond a program’s basic guidelines is sometimes called a lender overlay. For example, a loan program may permit a certain score while an individual lender requires a higher one.
This is why a general score chart cannot determine whether a particular borrower will qualify.
How do mortgage lenders determine your credit score?
Consumers can have many credit scores rather than one fixed score. The number may vary based on:
- The credit bureau
- The scoring formula
- The loan product
- The date the score was calculated
Which credit bureaus do lenders use?
Mortgage lenders commonly request credit information from:
- Equifax
- Experian
- TransUnion
These are the major credit bureaus (or reporting agencies) in the United States. While not government subsidiaries, they are regulated by federal and state laws as independent businesses. All three maintain consumer credit histories and provide that information to lenders and other authorized users who by law have access to the details of how people borrow, pay and repay.
Which score is used for one borrower?
When credit scores are available from all three credit bureaus, the lender generally uses the middle score. When only two scores are available, the lender generally uses the lower score.
What happens when multiple borrowers apply?
The process can be more complex when two or more people apply together. Each borrower’s applicable score is determined first.
When multiple borrowers apply, the score used for eligibility or pricing may depend on the loan program and underwriting method. Ask your loan officer which scores apply to your loan.
Why is my mortgage score different from the score I see online?
A score shown by a bank, credit card account or personal finance app may differ from the mortgage-specific score a lender obtains.
Different scoring models can evaluate the same credit information differently. A variation between scores does not necessarily mean that either score is incorrect.
How does your credit score affect a mortgage?
A credit score can affect both qualification and the cost of borrowing.
Loan eligibility
Credit guidelines may affect which mortgage programs are available and whether an application can proceed through automated or manual underwriting.
However, the score is only one part of the decision. Lenders also review the information in the credit report, including payment history and existing debts.
Interest rate and loan costs
A stronger credit profile may help a borrower qualify for more favorable mortgage pricing, particularly in relation to the interest rate for the mortgage loan. Credit score, down payment, loan type and loan term can all influence the interest rate as well as other costs.
A higher score does not guarantee the lowest rate. Two borrowers with the same score may receive different terms because their loans, properties and financial profiles are different.
Mortgage insurance and down payment
Credit can also affect conventional loan pricing and private mortgage insurance costs. The required down payment may vary by loan program and the strength of the application.
FHA mortgage insurance follows separate program rules. VA and USDA loans also have their own fees, eligibility standards and financing requirements.
A complete loan comparison is more useful than choosing a program based only on its advertised credit-score guideline.
What else do lenders consider besides credit?
Your credit score is important, but it does not tell the lender everything about your ability to manage a mortgage.
Lenders may also review:
- Income and employment history
- Monthly debt obligations
- Down payment and closing funds
- Cash reserves
- Recent late payments or collections
- Property type and occupancy
- Loan-program requirements
Your debt-to-income ratio (DTI) compares your monthly debt payments with your gross monthly income. A high DTI may limit the amount a borrower can qualify to finance, even when the borrower has strong credit.
A lower score also does not automatically prevent homeownership. The lender evaluates how the score fits with the rest of the application.
Can you buy a house with a low credit score?
You may be able to buy a home with a lower credit score. Your options depend on the reason for the score, the loan program and the rest of your financial profile.
A lender may consider:
- Whether recent payments were made on time
- How much revolving debt you carry
- How recently negative items occurred
- Whether your income is stable
- How much money is available for the purchase
Some buyers may be ready to apply now. Others may benefit from improving their credit, reducing debt or building savings first.
A Compass Mortgage loan officer can help you understand the trade-offs between moving forward and taking more time to prepare.
How can you prepare your credit before applying?
Focus on understanding the information in your reports before trying to reach a particular score.
- Review all three credit reports. Look for unfamiliar accounts, incorrect balances or payments mistakenly reported as late. Consumers can currently request free weekly reports through AnnualCreditReport.com.
- Dispute inaccurate information. Contact the credit reporting bureau and the business that supplied the information. Keep copies of the dispute and supporting records.
- Pay every bill on time. Consistent payment history is an important part of maintaining credit.
- Keep revolving balances manageable. High credit card balances may affect your score and monthly debt calculation.
- Avoid unnecessary new debt. New credit cards, vehicle loans or large financed purchases before a home purchase can affect both credit and mortgage qualification.
- Talk with a loan officer before making major changes. Closing accounts or using most of your available cash to pay debts may create unintended complications.
Credit improvement does not follow a fixed timeline. Results depend on what is affecting the score and when creditors report updated information.
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This can help you shop with more confidence and help sellers feel more comfortable with your financing.
FAQs: What credit score is needed to buy a house?
You may be eligible for maximum FHA financing with a score of at least 580. Approval still depends on the lender’s requirements and your complete application.
Mortgage options may be available with a 600 score. FHA, VA or USDA financing may be worth exploring based on your eligibility, property and overall financial profile.
No. Although 620 has historically been used as a common conventional mortgage reference point, it is not a universal minimum. Current underwriting systems may evaluate the complete credit-risk profile rather than applying one score threshold to every application.
No. Checking your own credit report does not affect your credit score. However, a credit check requested by a lender is commonly called a “hard inquiry” and may have a small effect.
There is no standard timeline. It depends on what is affecting the score, the actions taken and when updated information is reported.
Take the next step toward homeownership
A Compass Mortgage loan officer can help you understand how your credit may affect your mortgage options and identify practical steps for preparing to buy a home.
Apply with Compass Mortgage or call us at (877) 635-9795 to speak with one of our knowledgeable and helpful loan officers.
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