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Your credit score can make or break your house hunt.
In addition to dictating the types of loans youre eligible for, your credit score helps lenders determine your interest rate and other fees related to the loan. This is why it is important to understand your finances and know what credit score is needed to buy a house.
Weve updated this guide for 2025 to ensure you have what you need during your search this year. Our guide identifies the ideal credit scores for different types of loans and explains how your credit score influences the home-buying process and what you can do to improve your credit score.
The minimum score youll need differs based on the type of mortgage you want. Below we have a list of the typical minimum scores needed for several types of loans. Your current financial situation, including your credit score, can help you decide which is the best mortgage for you. Keep in mind that these scores may vary from one loan to another.
| Type of loan | Typical minimum credit score | What is it? |
| FHA loan | 580 with a 3.5% down payment | A loan insured by the Federal Housing Commission, popular for home buyers with poor credit or little savings |
| FHA 203K loan | 580 with a 3.5% down payment | A loan to finance the cost of renovation in addition to the purchase cost |
| Conventional loan | 620 | A loan not backed by a government entity |
| VA loan | 580 – 640 | A loan available to veterans and partially backed by the Department of Veterans Affairs |
| USDA loan | 640 | A loan eligible for rural and suburban home buyers |
| Jumbo loan | 700+ | A large loan that is higher than the conventional conforming loan limit |
FHA loans are insured by the Federal Housing Administration. The minimum credit score to qualify for the low down payment advantage is 580, and under certain circumstances, you can be approved with a credit score as low as 500. If you have a lower credit score, this may be a good option for you. However, if you have a higher credit score, youll be able to qualify for a better FHA loan with only a 3.5 percent down payment.
Section 203(k) insurance lets homebuyers and owners finance both the purchase and renovation of a house through a single mortgage. FHA 203(k) loans are intended to support lower-income families by helping them update older homes. The type of 203(k) loan will depend on the extent of the needed repairs.
Conventional loans are traditional commercial mortgages that are not backed by the government. They are usually backed by Fannie Mae or Freddie Mac, which are government-sponsored enterprises. When you apply for a conventional loan, its recommended to have a credit score of 620, which is the requirement set by Fannie Mae and Freddie Mac. If you have a higher credit score and money saved up for a large down payment, you may be able to score a low interest rate.
A VA loan is offered by the Department of Veterans Affairs for veterans and their family members. There are three VA-backed loans, as well as a VA direct loan. With a direct VA loan, the VA serves as your mortgage lender so that you dont have to go through a private lender. They require no down payment and often have low interest rates. VA-backed loans do not have a minimum credit score, so lenders have the discretion to decide on the credit score requirement.
USDA loans are government-backed loans designed specifically for properties located in eligible rural areas. You must also meet certain income requirements to qualify for a USDA loan. While there are no official credit score requirements, you can qualify for automatic underwriting approval through the USDAs Guaranteed Underwriting System if you have a minimum FICO score of 640. You may still be able to qualify with a score under 640, but youll need to go through manual USDA underwriting. Down payments are not required and interest rates are usually lower than conventional loan rates.
Jumbo mortgages allow people to get funding for expensive or luxury properties. Jumbo loans surpass the limits of conventional conforming loans. In 2025, the limit is In 2025, the limit is $806,500 for a single family home in most areas of the U.S.
Once you have a clear understanding of the credit score requirements for different home loans, you may want to assess your own credit score. In the event that your score is not high enough to secure a home loan, there are several strategies you can use to increase it. Before delving into different methods to boost your credit score, it is important to understand how your credit score can affect your ability to find the right house.
Its important to understand what generally determines a good credit score versus a poor credit score. There are a few different credit scoring systems, but the VantageScore and FICO scoring systems are the most common. Both systems score from 300 to 850 and determine credit score based on a variety of factors, like payment history and recent inquiries. See the FICO ranges of credit scores below.
| Credit score ranges | |
| <580 | Poor |
| 580 – 669 | Fair |
| 670 – 739 | Good |
| 740 – 799 | Very good |
| 800+ | Exceptional |
Here are the five factors that impact your FICO credit score:
Your credit score is an indicator of your ability to pay back lenders. A low score raises red flags and makes you appear risky. Due to this, lenders may ask for a higher down payment or give you a high interest rate. A low credit score also narrows the pool of loans you can consider when buying a home.
Meeting the minimum requirements for a loan may not always be the best option. Although you may qualify for a loan, you may have to pay a high interest rate depending on your score.
To get a more tangible picture of the impact of your credit score, use our mortgage calculator to see how drastically things can differ based on increases in your score.
A credit score in the 500s will likely narrow your options down to a bad credit loan. These loans normally come with higher interest rates and additional fees since lenders see you as a high credit risk.
As mentioned above, an FHA loan is one option to consider if your score is low or if you would have trouble making a large down payment. FHA loans are backed by the Federal Housing Administration and are less risky for lenders. These loans have less strict requirements for down payments and credit scores in comparison to other conventional loans, so this may be an option for you if you're having trouble securing other types of loans.
A score between 500 and 580 requires a minimum down payment of at least 10 percent. A score of at least 580 requires a minimum 3.5 percent down payment.
Keep in mind that lenders may take other factors into account when considering you for a loan. For example, it may help your chances of buying a home if a lender is aware of a past financial hardship you have since recovered from. Lenders also look at factors besides your credit score to determine if they'll approve you for a loan. Some of these things include:
Having positive marks in these areas can have an impact on a lender's decision, especially if your credit score is low. However, improving your credit score will enhance your chances of securing the loan you want.
If your credit score isnt up to par with what you need to take out a home loan, you should consider taking steps to improve it. This might include paying off outstanding debts, planning to make all your current payments on time or partnering with a credit repair firm to address any inaccurate or unfair items on your credit report. Take a look at our tips below to learn how you can take steps to improve your credit score.
Getting your debts down is important to help lower your DTI ratio. Although your DTI ratio doesn't directly affect your credit score, its a good idea to get it down for two reasons. First, as we've mentioned earlier, DTI is a deciding factor for lenders when granting loans. Prospective homebuyers should have a low DTI to secure a home loan. Most qualified mortgages have a max DTI of 43 percent. The higher your DTI, the riskier you appear to a lender.
Second, paying off revolving debt, like credit card balances, can help bring down your credit utilization. A lower credit utilization can help raise your credit score. When applicable, send a pay for delete letter to see if you can get certain negative items removed from your credit report. Otherwise, you can have this information on your credit report (and negatively impact your credit) for seven to 10 years.
Late and missed payments also negatively affect your credit score. Make a financial plan to catch up and stay caught up with your payments. Consider different payment strategies like the avalanche method and snowball method to effectively pay off your debt. Depending on your situation, you may also want to consider consolidating your debts or settling some of your debts.
To help pay your bills on time, you can also set up payment reminders or autopay.
The length of your credit history makes up 15 percent of your FICO score, so it can help to keep active credit cards open. This also increases the amount of available credit you have.
To prevent the card issuer from closing old cards due to inactivity, make occasional charges and pay them off promptly.
Your credit utilization is the second most important factor that goes into your credit score, so it's important to keep your credit balances low and pay down debt. To determine your credit utilization, add up your credit card balances and divide by your total credit available.
A credit utilization ratio of less than 30 percent indicates to lenders that you are financially responsible and less risky.
Only apply for new credit accounts, such as credit cards or loans, when you need them applying for too many new accounts too rapidly can lower your score. Too many hard inquiries can also raise red flags for lenders because it may indicate you need to borrow more money than you already have. New credit accounts also lower your credit age and can cause you to accumulate more credit card debt.
You should periodically review your credit reports for any inaccurate items. These mistakes can add up and drastically impact your score if theyre not removed. And thanks to the Fair Credit Reporting Act (FCRA), you have every right to dispute your credit reports whenever you find inaccurate information.
Now that you know what credit score range is needed to purchase a home, follow our above-mentioned tips to work on raising your score and opening the door to a more favorable home loan.
Buying a home can be more complicated when you have below-average credit. This is why it'ss important to work on your credit errors long before it comes time to buy property and Lexington Law could help. Get your free credit report summary so our credit repair team can work with you to address inaccurate items listed on your credit reports.
Still have questions about the credit score needed to buy a house? Find answers below.
Yes, you can buy a house with a 700 credit score, which is considered very good. A 700 credit score can qualify you for the best mortgage options, including competitive rates and terms on conventional loans.
A credit score of 620 or higher is typically considered good enough to qualify for a mortgage. However, a higher credit score can lead to better interest rates and loan terms. Some loans, like FHA loans or VA loans, may require a lower minimum credit score of 580.
The credit score required to buy a $300,000 house depends on various factors, including your income, down payment and the type of loan you choose. Generally, youll need a credit score between 580 and 720 or higher, depending on the type of loan you choose. For example, an FHA loan will typically require a minimum credit score of at least 580.