Quick Answer: What Credit Score Do I Need to Buy a House?

Minimum credit scores by loan type: FHA (580 with 3.5% down, 500 with 10% down), Conventional (620), VA (no official minimum, but 620+ typical), USDA (640). For the best mortgage rates, aim for 700+. Scores above 740 typically qualify for the best rates.

You don't need perfect credit—620+ opens most loan options
Check all three credit bureaus (Equifax, Experian, TransUnion) before applying
Pay down credit card balances to under 30% utilization for quick score improvement
Avoid opening new credit accounts while house hunting
disputing errors on your report can improve your score within 30-45 days

Credit Score Requirements by Loan Type

FHA Loans

Credit Score	Down Payment
580+	3.5% minimum
500-579	10% minimum
Below 500	Not eligible

Conventional Loans

Credit Score	Requirements
620+	Minimum for most lenders
680-699	Better rates
700-739	Good rates
740+	Best rates

VA Loans

No official minimum from VA
Most lenders require 620+
Some lenders go down to 580

USDA Loans

Minimum 640 required
No down payment needed
Income and location requirements apply

How Credit Scores Affect Your Rate

Rate Comparison on $300,000 Loan

Credit Range	Rate (Example)	Monthly Payment	Total Interest (30 yr)
760-850	6.5%	$1,896	$382,560
700-759	6.75%	$1,946	$400,560
680-699	7.0%	$1,996	$418,560
660-679	7.5%	$2,098	$455,280
620-639	8.0%	$2,201	$492,360

Difference between 760+ and 620: Over $300/month, $110,000+ over loan life

What Lenders Look For

The 5 Factors of Your Credit Score

Factor	Weight	What It Means
Payment History	35%	On-time payments
Credit Utilization	30%	Balance vs. limit
Length of History	15%	Age of accounts
Credit Mix	10%	Types of credit
New Credit	10%	Recent applications

Red Flags for Lenders

Recent late payments (especially mortgage/rent)
Collections or charge-offs
High credit utilization
Too many recent credit inquiries
Bankruptcies or foreclosures (must be discharged)

Quick Ways to Improve Your Score

1. Pay Down Credit Cards

Reduce utilization to under 30%
Under 10% is ideal
Pay before statement closes for faster impact

2. Dispute Errors

Get free reports at AnnualCreditReport.com
Dispute any errors online
Resolution typically takes 30-45 days

3. Become an Authorized User

Ask family member with good credit
Their positive history helps your score
No need to use the card

4. Keep Old Accounts Open

Length of history matters
Don’t close old cards even if unused
Use occasionally to keep active

5. Pay All Bills on Time

Even non-credit bills can affect score
Set up auto-pay for minimums
One late payment can drop score 50-100 points

Timeline: Building Credit for a Mortgage

If Starting from Scratch

Month 1-3: Open secured credit card or credit builder loan
Month 4-6: Use card regularly, pay in full
Month 6-12: Apply for second card
Month 12-24: Continue on-time payments
Month 24+: Ready for mortgage application

If Improving Existing Credit

Week 1-2: Check reports, dispute errors
Month 1-3: Pay down balances, avoid new credit
Month 3-6: Score should improve significantly
Month 6+: Apply for pre-approval

Don’t Do These While House Hunting

❌ Open new credit cards
❌ Buy a car or finance furniture
❌ Close credit accounts
❌ Max out credit cards
❌ Change jobs (if possible)
❌ Make large deposits without documentation

Credit Score for Mortgage: What First-Time Buyers Need