What Credit Score Do You Need to Buy a House?

The credit score you need to buy a house starts at 500 for FHA and runs up from there — but the number on a program guideline isn't always the number a lender will approve. Overlays, reserves, and the rest of your financial picture shape your actual odds more than the headline minimum does.[1][2]

🔑 Key takeaways:

• FHA loans usually allow credit scores as low as 500 with a larger down payment (lower scores require 10% as opposed to 3.5% for higher scores). But program minimums aren't approval bars.
• Your score has a measurable dollar impact. On a $300,000 loan, a 760 FICO pays $324 less per month and $116,000+ less in total interest than a 620 FICO over 30 years.[3]
• Cash reserves can offset a lower score. Below 640, cash on hand often matters more than the score itself.
• You can shop multiple mortgage offers within a 45-day window without harming your credit score.[4]
• Pull your reports first. Free weekly reports from all three bureaus are available at AnnualCreditReport.com. Catching errors can lift your score before you apply.
• Credit repair is faster than most people think. Paying down a balance or fixing an error moves the needle in 30–45 days. A focused 90-day push can meaningfully change your rate.

Minimum credit score requirements for mortgages

The minimum credit score you need to buy a house depends on the type of mortgage program you’re applying for, and there are even home loans for bad credit.

A common mortgage loan type is a conventional mortgage that follows Fannie Mae and Freddie Mac selling guidelines (also known as "conforming” loans).[5]

There are also a few government-backed home loan programs under the Federal Housing Administration (FHA), Veterans Affairs (VA), and U.S. Department of Agriculture (USDA).

• Conventional (conforming) loans: The minimum 620 credit score requirement for automated underwriting of conforming conventional loans was dropped by Fannie Mae in November 2025. Today, the mortgage program relies on a holistic analysis of a prospective homebuyer’s credit profile rather than establishing credit score minimums, although some lenders might still require score minimums.[6]
• FHA loans: Generally, FHA loans allow a minimum 580 credit score with a 3.5% down payment. For those with a 500–579 score, a 10% down payment is required.[7][8]
• VA loans: Although the VA loan program sets no explicit minimum credit requirements, lenders dictate what the minimum score you’ll need is to buy a house with a VA loan.
• USDA loans: USDA loans don’t impose a hard credit score limit, but if your score is below 640, lenders are required to do manual underwriting or ask for additional documentation.[9]

Conventional, non-conforming loans — which aren’t beholden to Fannie and Freddie standards — and niche mortgage loans are also available. Lenders set the credit score floor for these mortgage options but minimum credit requirements are generally higher since the loans are considered riskier.[13]

Since some home loan programs don’t have hard credit limits, reaching out to your lender about your credit qualifications is the most accurate way to gauge credit eligibility. 

What lenders actually approve: Why your credit score isn't the whole story

Chris Kuclo, senior director of agent relations and sales at Best Interest Financial (NMLS 926690), has been through thousands of applications and says the credit-score threshold is less of a wall than borrowers think.

"Credit score is always going to be kind of like a binary switch," he says. "There are plenty of options right now for somebody below a 640 credit score, but that's when you start getting into the assets. That's why the asset thing comes up more frequently as the biggest stopper."

In other words: once a borrower dips below 640, how much cash they have in reserve often matters more than the score itself. Kuclo says his team has closed loans for buyers with scores in the mid-500s when the reserves lined up:

"If you have multiple months reserved, you can fly through with a 565-570 credit score. Somebody over 640, it becomes a lot easier around assets. We can do down payment assistance programs a lot easier."

Will applying for a mortgage affect my credit score?

Once you submit your mortgage application, it will temporarily lower your credit score. Like consumer loans and lines of credit, mortgage lenders require a credit check to determine whether you qualify for a home loan. This process involves a soft and hard credit inquiry. 

• Soft credit inquiries are used for mortgage preapprovals based on preliminary information and don’t affect your credit score. 
• Hard credit inquiries are performed if you move forward with your mortgage application. Hard credit checks are a comprehensive review of your credit background, and temporarily lower your score by a few points.[14]

The good news is that you can still shop around and submit multiple mortgage applications without it severely affecting your credit score. Homebuyers typically have a 45-day shopping period to get mortgage preapprovals and loan estimates. This shopping window will begin once you give a lender permission to do a hard credit inquiry. Any additional mortgage lender inquiries within this window are treated as one credit inquiry for scoring purposes.[15]

How your credit score affects your mortgage rate

Estimated 30-year fixed mortgage rate by FICO® score range

The table below shows how a borrower's FICO score range affects the interest rate and monthly payment on a $300,000, 30-year fixed-rate mortgage. Figures are sourced from the myFICO Loan Savings Calculator, which is updated continuously from national lender data and is the industry's most widely cited rate-by-band benchmark.

Estimated 30-year fixed mortgage rate and payment by FICO® score range · $300,000 loan amount · Source: myFICO Loan Savings Calculator, accessed April 21, 2026

FICO® score range	Estimated APR	Monthly P&I	Total interest (30 yr.)
760–850 Excellent	6.41%	$1,879	$376,326
700–759 Good	6.63%	$1,923	$392,232
680–699 Fair-Good	6.81%	$1,959	$405,298
660–679 Fair	7.02%	$2,002	$420,678
640–659 Fair	7.45%	$2,090	$452,329
620–639 Poor-Fair	7.99%	$2,203	$492,930

Reading the table: A borrower with a 760 FICO pays roughly $324 less per month and more than $116,000 less in total interest over 30 years than a borrower with a 620 FICO on the same $300,000 loan.

Kuclo of Best Interest Financial says the table above reflects a national average, but individual lenders, including BIF, often beat these figures for borrowers who bring strong compensating factors:

"A common situation that we see is around a 650 credit score — so not in the bad range, but in the fair range," he says. "If your DTI is over 40%, you're sitting with that credit score, private mortgage insurance is going to be very hot on the conventional spectrum. Expect probably $160 to $170 for every loan amount of $100,000."

Actual rates and terms vary by lender, loan type, down payment, debt-to-income ratio, and market conditions on the day you lock. Figures above are directional. Contact a Best Interest Financial loan officer for a live quote on your situation.

How can I improve my credit score before buying a house?

If your score needs work before you apply, this timeline table shows how quickly different actions move the needle. Here's what to focus on first.

Estimated timelines to improve specific credit factors

Action	How long before your score changes	Source
Pay down a credit card balance	30–45 days (once the lower balance reports)	Experian
Dispute and remove a credit report error	30–45 days by federal law	CFPB
Rebuild after a late payment	6–12 months of on-time payments to fully recover	FICO
Remove a collection account	Up to 7 years (paid or unpaid); may drop off sooner if disputed successfully	FICO / FTC
Build a new credit file from scratch	6 months minimum before a FICO score can be calculated	FICO

Seeing meaningful improvement to your credit score takes time and consistency. If you’re buying a house in the near future, start practicing these good credit habits to strengthen your score:

• Dispute credit reporting errors: Check your credit report regularly for errors. For example, make sure there’s not a credit account that doesn’t belong to you or a delinquent status that’s a mistake. Disputing these errors with the credit bureaus immediately can significantly improve your score. Just keep in mind that the dispute process can take 30-45 days.[16]
• Make on-time bill payments: Payment history is the biggest factor (35%) in calculating your FICO score.[17] Timely monthly payments show mortgage lenders that you have a positive track record of responsibly paying your debt and are more likely to do the same if approved for a mortgage loan. A good rule of thumb is to check when your credit card bill is due and set up automatic payments to pay your card in full each month before that date.
• Keep your credit utilization low: Credit utilization — the amount of credit you’ve used in relation to your available credit — is the next-largest slice (30%) of FICO’s credit score calculation.[18] From a lender’s perspective, what you owe on other debt accounts directly impacts how you’ll manage a hefty mortgage payment. Paying down debts, like credit card balances, is a good first step at reducing your credit utilization ratio. You can also ask to increase your line of credit on your cards to improve your utilization ratio, although this may trigger a hard credit inquiry.
• Avoid major changes to your credit accounts: This includes opening new credit accounts, like consumer loans, retail or gas cards and closing existing accounts immediately before applying for a mortgage. Opening a new line of credit might raise flags among mortgage lenders, and closing old accounts increases your credit utilization ratio since you have less available credit to your name.

Not sure where your credit stands?

What to do based on your score

If your FICO score is 760 or higher Excellent

You're in the top rate tier for every loan program. Shop at least three lenders within a 14-day window (rate-shopping counts as one inquiry) and compare Loan Estimates line-by-line. Don't skip the PMI discussion even on conventional loans — a better score can mean lower PMI, not just a lower rate.

If your FICO score is 700–759 Good

You qualify for a conventional loan with competitive pricing. Before applying, confirm there are no errors dragging your score down — 34% of consumers found at least one credit report error in a 2024 CFPB analysis, and correcting them can push a "Good" borrower into "Excellent" territory before closing.

If your FICO score is 620–699 Fair to Fair-Good

You'll qualify for FHA or conventional loans, but the rate pricing gets meaningfully worse below 680. Ask any lender you talk to specifically about compensating factors — reserves, stable employment, low DTI — that can offset the score. Request at least three quotes; pricing variation is widest in this band.

If your FICO score is 580–619 Poor

FHA is your most realistic path; the program allows 580 with 3.5% down, though many lenders require 620 or higher. Look specifically for lenders that don't layer overlays above the FHA floor. BIF has closed loans in this band when the borrower brought two to three months of mortgage reserves.

If your FICO score is below 580 Very Poor

FHA technically allows 500 with 10% down, but lender willingness drops sharply below 580. You're usually better off spending 6–12 months on targeted credit repair (paying down revolving balances, disputing errors, avoiding new credit) before applying. Every 20-point lift from 560 to 620 can save you thousands in interest over the life of the loan.

Consulting with a mortgage lender is the best way to definitively know whether your credit score is good enough to buy a house. Although all loans and lenders have general guidelines they tend to adhere to, there are usually a lot of levers lenders can pull to make a loan work for you.

Kuclo, senior director at Best Interest Financial, says credit has become less of a make-or-break factor than it was a decade ago:

"Ultimately, credit has lessened as the big roadblock that it was in years past. If you have multiple months reserved, you can fly through with a 565-570 credit score," says Kuclo.

Mortgage lenders will go over your exact financial situation and determine all the lending options available to you, based on your qualifications.

The home-buying process can be intimidating, especially for first-time homebuyers. If you’re looking for mortgage loan options and a no-pressure experience, Best Interest Financial can help. Their team of experts can explain your options and help you develop a plan. Get started with a quote from Best Interest Financial today.