hand holding lots of credit cards for topic credit score to buy a house

Do You Have the Credit Score To Buy a House?


What You Need To Know

  • Your credit score is a number ranging from 300 to 850 that represents your creditworthiness
  • A higher credit score means you’re more likely to qualify for a mortgage and get a low mortgage interest rate
  • If you have a lower credit score, you may still qualify for a Federal Housing Administration (FHA) or a Department of Veterans Affairs (VA) loan


Ready to buy a house? Well, besides finding a property you like, you’ll need to acquaint yourself with the mortgage process so you can get a good home loan.

One of the first things a mortgage lender will ask you at the start of the preapproval process is, “What is your credit score?” It’s an important question because your credit score will show how good you are at paying back debt. 

Your score is an important piece of the home buying puzzle. Depending on the number, it can help you qualify for a mortgage loan with a competitive interest rate and favorable terms. 

Not sure what a credit score is? Wondering why credit scores even matter? Curious if your score qualifies you to get good mortgage rates? You’ve come to the right place. Our MoneyTips guide will answer all of your burning credit score questions. 

What Is a Credit Score? 🧐

A credit score is a three-digit number from 300 – 850 that follows you for the rest of your life. The score is designed to measure your creditworthiness (read: reliability paying back debt). It’s how lenders will determine if your credit is “healthy” enough to qualify for their services – and their money.

When it comes to credit scores, we aren’t talking about golf rules (for fans of the sport). Lower is definitely not better. The higher your score, the more likely it is that lenders will trust that you’ll be able to pay back the money you’ve borrowed. That three-digit number represents how you’ve handled borrowing money and making payments on everything from your car to your cellphone bills.

What determines my credit score?

To determine your score, the three major credit reporting bureaus (Equifax®, Experian™ and TransUnion®) build a credit report based on the financial data they collect from lenders, banks, utility companies, credit card issuers and more. Some of the most common factors they use to calculate a score are:

  • Payment history: Do you pay your bills on time – even your cellphone bill? Late payments will hurt your credit score.
  • Credit utilization ratio: It is the amount of credit you’ve used compared to your credit limit. Put another way, it’s how much you owe versus the max amount you can borrow. If you’ve maxed out a credit card, chances are your credit utilization ratio is pretty high. And that can hurt your score. The rule of thumb is to keep your credit utilization ratio below 30%.
  • Derogatory marks: Nope, this isn’t your 4th-grade report card coming back to haunt you. If you’ve ever had accounts go to collections, filed for bankruptcy or had a foreclosure or tax lien on a property in your name, that will become a derogatory mark on your credit report.
  • Number of accounts: It’s not a bad idea to have a mix of different types of credit accounts, like credit cards and loans, on your credit report, but opening too many accounts too quickly may be a sign that you can’t manage your debt – or it could be a red flag for identity theft or fraud – and lenders aren’t fans of red flags. 🚩🚩🚩
  • Credit history: In other words, how experienced are you at managing debt? 

Lenders pore over your credit report to understand your financial history and see how you’ve managed your accounts. They determine your credit score using one of the two most common credit-scoring models: FICO® or VantageScore®. 

If you’re curious about your score, there are a few ways to find out what it is. A lot of credit card companies give cardholders free access to their credit score (which may or may not be a FICO® score). You can also get a free copy of your credit report once a year at AnnualCreditReport.com.

What Is a Good Credit Score To Buy a House?

There’s no definitive answer to this, but there are a few golden numbers to aim for when it comes to making sure you have a credit score that will qualify for the best loan terms. Different lenders have different standards, and there’s lots of other factors at play, but expect needing to meet these minimum credit score requirements to qualify:

Mortgage Loan TypeMinimum Credit Score Required
Conventional Loan620
Jumbo Loan680
FHA Loan580 with 3.5% down or 500 with 10% down[2]
VA LoanNo minimum, but most lenders prefer 580[3]

Conventional loan

Conventional mortgages are the standard home loans offered by most banks and non-bank lenders. While these conventional loans conform to government standards set by Fannie Mae and Freddie Mac, the agreements are strictly between you and your lender. 

While every lender has different standards, most lenders will divide borrowers between five credit score tiers:

  • Excellent: 740+
  • Very good: 670 – 739
  • Good: 620 – 669
  • Fair: 500 – 600
  • Poor: 300 – 499

Which tier your credit score falls into will determine:

  • Your mortgage interest rate (how much you pay the lender to borrow money)
  • The percentage of the home sale price you’ll need to put toward a down payment
  • What you’ll pay in private mortgage insurance (PMI) if you can’t make a 20% down payment 

The better your credit score, the easier — and cheaper — the mortgage process will be. So, sometimes, it might be worth holding off on buying a home to prioritize building up your credit score

With a high enough credit score, a lender may not need to ask for as much paperwork and may be more willing to negotiate on settlement costs and other aspects of the mortgage loan.

Jumbo loan

Are housing prices skyrocketing in your area? Are you wondering whether you’d qualify for that million-dollar listing? 

If you want to borrow more than the Federal Housing Finance Agency (FHFA) limit of $647,200 (or $970,800 in certain high-cost areas),[4] you’ll need a jumbo loan. Each lender may have different criteria to qualify for these larger loans, but they typically look for a credit score of 680 or higher.

FHA loan

Even if you don’t have a credit score of 620 or higher, you’ve still got options. Lenders will accept credit scores as low as 500 for FHA loans, though most require a minimum credit score of 580 or higher.

These loans are issued through private lenders, but they are backed by the federal government. Anyone can apply for an FHA loan, but they’re targeted to first-time home buyers, borrowers with lower credit scores, and borrowers with a bankruptcy or past financial issue on their record. 

To qualify for an FHA loan, you’ll need:

  • 2 years of verifiable employment history
  • An established credit history
  • A 3.5% down payment with a minimum credit score of 580 or higher or a 10% down payment with a credit score of 500 – 579

If you’re already a little confused with the various mortgage possibilities (we’ve got more below), it’s okay. You can talk it through with a lender who can give advice about what kind of mortgage is best for you. Seek out a professional like our MoneyTips vetted recommendation:

Get movin’! with Rocket Mortgage

We teamed up with our recommended lender Rocket Mortgage® to help you qualify for a loan and enjoy your dream home!

What do you want to do?

So you’re in your feels about buying a new home? 💜
Tell us a bit more about it.

Looking to refinance for a better rate or extra cash? 💸
Don’t worry, MoneyTips has got you covered.

The property is a… What kind of property?
I intend to use it as my… How do you use it?

Fill in all details first to move on.

Sweet choice.👌
Let’s find out when you are going to buy.

Help us find the best rate for you, on your schedule.

Help us find the best rate for you.

Have a second mortgage?
I’m planning to buy…
My credit score is… What’s your credit like?
Determining Your Credit Score
  1. Your credit score is a three-digit number that’s used to predict how likely it is you’ll pay back money you borrowed.
  2. The score generally ranges from 300 (low) to 850 (excellent). It’s calculated by looking at your previous credit history.
  3. You can check your credit report to find the number or use a free credit tool. You can also plug in your best guess.

It’s 💯 okay if your credit score isn’t perfect! Wow ⭐ looks like you’re in great financial shape!

It’s 💯 okay if you have another mortgage or an imperfect credit score! It’s all good if you have a second mortgage (or not).

You’re almost there. Just a few deets needed.
We’ll have Rocket’s people talk to your people. 😉

First-time home buyer?

Fill in all details first to move on.

To find out what you qualify for, hit the button!

You did it!

A home loan expert from Rocket Mortgage® will reach out to you soon.

Nice work!

A refinance expert from Rocket Mortgage® will reach out to you soon.

In the meantime…
Back to the content you came here for! 👍
Feel at Home Make your home feel like home with this handy move-in checklist. ✅
Feel at Home Settle in with home improvement tips & tricks. 🔨
Feel at Home Settle in with home improvement tips & tricks. 🔨

VA loan

As a veteran of the U.S. armed forces, you may be eligible for a VA loan to buy, build or improve a home or to refinance your current mortgage. 

A huge VA loan perk is that you aren’t charged private mortgage insurance (PMI), though you may pay a one-time upfront fee (VA funding fee) that can be added to your closing costs.

There is no minimum credit score required to qualify for a VA loan. However, individual lenders can set their own minimums for approval. Most lenders prefer a credit score of 580 or higher.

Many veterans are eligible for a funding fee waiver, so check with your lender or the VA when you apply for a VA loan.

USDA loan

If you’re interested in building or buying a home in one of America’s many rural areas, you may qualify for a U.S. Department of Agriculture (USDA) loan.

There’s no set credit score requirement for these loans,[5] so whether you qualify will depend on the discretion of individual lenders, and most lenders prefer a credit score of 640 or higher. There’s also no minimum down payment required. Instead, you need to pay a 1% upfront fee and a .35% annual fee.[6]

However, there are some other requirements. There’s no set limit on the acreage for the property, but it has to be comparable to other properties in the area. Also, the home you build or buy has to be your primary residence and you can’t earn more than 115% of the median household income for the area to qualify for a USDA loan.[5]

How Can I Improve My Credit Score?

The good thing about credit scores is that they can change. With the right strategies, today’s low credit score can be a higher and “healthier” score in the future.

Improve your credit score by:

  • Paying your bills on time and in full
  • Paying down existing debt, especially high-interest credit card debt
  • Combining high-interest debt (like credit cards) into one lump sum with a lower-interest credit card, personal loan or home equity loan
  • Increasing your income with higher-paying work or getting a side hustle
  • Tackling any red flags on your credit report, like signs of fraud or identity theft, that could be harming your score
  • Signing up for credit cards to build your credit history and using them responsibly
  • Going beyond internet hacks and talking to a financial planner or a nonprofit credit counselor

Pro tip: If you know someone with good credit – like a parent, sibling or close friend – they may be able to improve your chances of getting approved for a mortgage by acting as a co-signer.

But there’s a big risk that comes with co-signing. The co-signer has to repay the loan if you can’t – and that can negatively affect their credit (as well as their budget). So, everyone involved needs to know the risks and feel comfortable assuming them.

Credit Score Knowledge Is Power

When you’re looking for a mortgage — or any type of loan — knowing your credit score is power. Armed with this information, you’ll have a better expectation of the kinds of mortgage terms lenders will offer. You’ll be better prepared to determine which loan is best for you. And, if you know your score could use some work, now you know how to improve your credit score before you commit to getting a mortgage.

  1. FICO®. “FICO® SCORE EDUCATION.” Retrieved October 2021 from https://www.ficoscore.com/education#WhatYour

  2. U.S. Department of Housing and Urban Development. “Section C. Borrower Credit Analysis.” Retrieved October 2021 from https://www.hud.gov/sites/documents/4155-1_4_SECC.PDF

  3. U.S. Department of Veterans Affairs. “VA Guaranteed Loan.” Retrieved October 2021 from https://www.benefits.va.gov/BENEFITS/factsheets/homeloans/VA_Guaranteed_Home_Loans.pdf

  4. Federal Housing Finance Agency. “FHFA Announces Conforming Loan Limits for 2022.” Retrieved December 2021 from https://www.fhfa.gov/Media/PublicAffairs/Pages/FHFA-Announces-Conforming-Loan-Limits-for-2022.aspx

  5. U.S. Department of Agriculture. “Single Family Home Loan Guarantees – What does this program do?” Retrieved November 2021 from https://www.rd.usda.gov/sites/default/files/fact-sheet/508_RD_FS_RHS_SFHGLP.pdf

  6. U.S. Department of Agriculture. “USDA Rural Development Reducing Fees Make Home Loans More Affordable. ” Retrieved November 2021 from https://www.rd.usda.gov/newsroom/news-release/usda-rural-development-reducing-fees-make-home-loans-more-affordable

What's your next



Wondering where to go for a mortgage? We’ve got you covered! Here’s a vetted recommendation that can get you into the home of your dreams.



People carrying boxes

In Case You Missed It

  1. Your credit score can affect whether you qualify for a mortgage and the interest rate you’re offered

  2. Different lenders have different standards, but a conventional mortgage usually requires a score of 620 or higher

  3. You can improve your credit score over time. If you need a short-term assist, consider a government-backed mortgage or finding a co-signer

You Should Also Check Out…