What credit score do you need to secure a mortgage? (2024)

For more people, their credit score is one of the most important factors in determining whether or not they can buy a home.

Lenders lean heavily on your score — which can range from 300 on the low end all the way up to 850 — to decide whether to approve you and what interest rate to offer.

Below, CNBC Select outlines credit score requirements for mortgages, how to prime your credit and mortgage options if you have bad credit.

What we'll cover

  • What credit score do you need to get a mortgage?
  • How to improve your credit score before applying for a mortgage
  • Mortgage options for low credit scores
  • Bottom Line

What credit score do you need to get a mortgage?

Mortgage lenders typically want to see a score of 620 or better before approving a conventional mortgage. There are government-insured mortgages if your score is lower, and if your score is760 or higher you'll qualify for the best interest rates.

Conventional loan

Credit score required: 620

Conventional loans are the most common type of mortgage, accounting for about 70% of the market. They usually require a 620 credit score, though some lenders will consider applicants with scores as low as 580.

Conventional mortgages are divided into conforming or non-conforming loans, depending on whether they adhere to lending rules set by Fannie Mae and Freddie Mac, such as maximum loan amounts.

Chase Bank offers conventional mortgages with 10- to 30-year terms, and both fixed and adjustable-rate options. Applicants can qualify for a 0.50%discount on financing if they have a Chase checking or savings account.

Chase Bank

Jumbo loan

Credit score required:680

A jumbo loan is a type of conventional loan that exceeds the loan limits set by Fannie Mae and Freddie Mac. Because it's not possible to sell them to a federally insured mortgage provider, these loans are riskier for the lender. So, borrowers must have at least a 680 credit score.

FHA Loan

Credit score required: 580 (with 3.5% down payment), 500(with 10% down payment)

Insured by the Federal Housing Administration, FHA loans are aimed at borrowers who are making a smaller down payment or who have bad credit.

In 2024, the maximum loan limit for an FHA loan ranges from $498,257 and $1.1 million, depending on your location.

You'll need to have a debt-to-income ratio of under 50% and, if you make a down payment of under 20%, you'll probably be required to take out primary mortgage insurance (PMI), which can cost anywhere from 0.5% to upwards of 2% of your total loan.

VA loan

Credit score required: None officially, though many lenders prefer 620

Insured by the U.S. Department of Veteran Affairs, VA loans are designed for current and former servicemembers and their spouses. No down payment is required and, while most lenders will want a 620, the VA doesn't set any credit score requirements.

USDA loan

Credit score required: None officially, though most lenders prefer 640

A USDA loan is insured by the U.S. Department of Agriculture and is meant for low- to moderate-income home buyers. The USDA doesn't require a down payment and doesn't set a minimum credit score requirement, though most lenders will want borrowers to have at least a 640.

Read more: The best VA loan and USDA mortgage lenders

Compare offers to find the best mortgage

How to improve your credit score before applying for a mortgage

Having a higher credit score can save you thousands in interest payments over the life of a mortgage — and help with insurance premiums, too.

Read more: 4 tips to boost your credit score fast

Your credit score reflects your history of paying off debt. Here are some ways to improve it.

  • Make on-time payments on credit cards, loans and other debts.
  • Pay the full balance due on your credit card each month
  • Keep your credit utilization rate under 30%
  • Increase your credit limit on existing cards
  • Don't open new lines of credit

Mortgage options for low credit scores

Some conventional mortgage providers will lend to those with a credit score lower than 620.

Cardinal Financial Mortgage offers conventional loans, as well as FHA, VA, USDA loans, and will approve borrowers with a credit score as low as 550.

Cardinal Financial Mortgage

  • Annual Percentage Rate (APR)

    Apply online for personalized rates; fixed-rate and adjustable-rate mortgages included

  • Types of loans

    Conventional loan, FHA loan, VA loan, USDA loan, jumbo loans and construction loans

  • Terms

    Not disclosed

  • Credit needed

    Minimum of 550 for some loan types

  • Minimum down payment

    Not disclosed

Terms apply.

CitiMortgage only requires a 580 credit score and provides FHA loans, VA loans and jumbo loans, as well as fixed-rate and adjustable-rate financing. It's LenderPaidAssistance program gives borrowers as much as $5,000 for closing costs.

CitiMortgage®

  • Annual Percentage Rate (APR)

    Apply online for personalized rates

  • Types of loans

    Conventional loans, FHA loans, VA loans and Jumbo loans

  • Terms

    15 – 30 years

  • Credit needed

    580

  • Minimum down payment

    3%

Terms apply.

Bottom line

Typically, you'll need a credit score of 620 if you want to take out a mortgage. But, there are alternative options for some lenders. Either way, you'll want to spend some time boosting your credit score before you apply for a mortgage to get the most favorable rate.

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Read more

How to prime your credit before applying for a mortgage

The 5 best mortgage lenders

Which of these mortgage types is right for you?

How to understand your credit score (and check it for free)

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.

What credit score do you need to secure a mortgage? (2024)

FAQs

What credit score do you need to secure a mortgage? ›

The minimum credit score needed for most mortgages is typically around 620.

What credit score do you need to get a mortgage? ›

You'll typically need a credit score of 620 to finance a home purchase. However, some lenders may offer mortgage loans to borrowers with scores as low as 500. Whether you qualify for a specific loan type also depends on personal factors like your debt-to-income ratio (DTI), loan-to-value ratio (LTV) and income.

What is the minimum credit score to assume a mortgage? ›

FHA Assumable Mortgage Requirements

Buyers wishing to assume an FHA mortgage must have a minimum credit score of 620, although buyers with scores above 580 may be eligible with additional restrictions.

What FICO score do you need for a good mortgage? ›

670–740: Good credit – Borrowers are typically approved and offered good interest rates. 620–670: Acceptable credit – Borrowers are typically approved at higher interest rates.

How much of a home loan can I get with a 720 credit score? ›

Best FHA Loan For Rates With 700 to 720 Credit Score

The interest rates you could get if your credit score is 700, 710, or 720 are some of the best available. In this range, based on a $250,000.00 FHA home loan, your monthly payment would be roughly $1,100.

What is the lowest credit score needed for a house? ›

Credit score needed to buy a house by mortgage type
Loan TypeMinimum Credit Score
Conventional loans620
FHA loans500 (with 10% down payment); 580 (with 3.5% down payment)
USDA loans640
VA loansThe VA has no minimum limit, but lenders generally like to see at least 620
1 more row
Jan 10, 2024

How much of a home loan can I get with a 650 credit score? ›

Your credit score typically won't affect the home loan amount you're able to receive. Instead, it will affect the interest rate of the loan. The lender will determine how much you can borrow based on a number of factors like your income, debt-to-income ratio, and more.

What credit score is needed to buy a $400,000 house? ›

Your credit score has less bearing on your ability to get a mortgage than you might think. The minimum FICO score for a conventional loan is 620. The best rate comes with a score of 740 or higher.

What is the minimum FICO for home possible? ›

No income limits apply if the home is located in an underserved area. Credit: Credit scores as low as 660 for purchase transactions and 680 for no cash-out refinances are considered.

What is the best credit score to buy a house? ›

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.

What credit score is needed to buy a $300K house? ›

What credit score is needed to buy a $300K house? The required credit score to buy a $300K house typically ranges from 580 to 720 or higher, depending on the type of loan. For an FHA loan, the minimum credit score is usually around 580.

What credit score is needed to buy a $500,000 house? ›

Mortgage lenders typically want to see a score of 620 or better before approving a conventional mortgage. There are government-insured mortgages if your score is lower, and if your score is 760 or higher you'll qualify for the best interest rates.

What credit score to buy a car? ›

The credit score required and other eligibility factors for buying a car vary by lender and loan terms. Still, you typically need a good credit score of 661 or higher to qualify for an auto loan. About 69% of retail vehicle financing is for borrowers with credit scores of 661 or higher, according to Experian.

How much house can I afford if I make $36,000 a year? ›

On a salary of $36,000 per year, you can afford a house priced around $100,000-$110,000 with a monthly payment of just over $1,000. This assumes you have no other debts you're paying off, but also that you haven't been able to save much for a down payment.

How much income do you need to qualify for a $200 000 mortgage? ›

With a 5% down payment and an interest rate of 7.158% (the average according to Mortgage Research Center's rate tracker at the time of writing), you will want to earn at least $4,544 per month – $54,528 per year – to buy a $200,000 house. This is based on an estimated monthly mortgage payment of $1,636.

What is a pretty good credit score? ›

Although ranges vary depending on the credit scoring model, generally credit scores from 580 to 669 are considered fair; 670 to 739 are considered good; 740 to 799 are considered very good; and 800 and up are considered excellent.

Can I get a mortgage with a 600 credit score? ›

Yes, you can buy a house with a 600 credit score — but it would be less challenging if your score were higher. A 600 score will not be high enough to qualify for a conventional home loan, so look into FHA loans, which have lower requirements: 500 with a 10 percent down payment, and 580 with a 3.5 percent down payment.

How high a credit score do you need for a mortgage? ›

There isn't a specific credit score you need for a mortgage, and that's because there isn't just one credit score. When you make an application for a mortgage or other type of credit, lenders work out a credit score for you.

Can I buy a house with a 580 credit score? ›

You can get a mortgage with a credit score as low as 620, 580 or even 500, depending on the type of loan. Some mortgage lenders offer bad credit loans with more flexible qualifying requirements but higher costs. Others offer free credit counseling to help you improve your score before applying for a loan.

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