Most lenders want a credit score of 620 or higher, but the real requirement depends on the loan type and your down payment
There is no single credit score that unlocks home buying. A conventional loan from a bank typically requires 620 as a minimum, though many lenders prefer 640 or 660 and offer better rates above 740. An FHA loan (backed by the Federal Housing Administration) can go as low as 580 with a 10 percent down payment, or 500 with 10 percent down at some lenders, though rates and fees climb as your score drops. A VA loan (for military members and veterans) has no official minimum score, but most VA lenders set their own floor between 580 and 620. A USDA loan (for rural properties) typically requires 620 or higher.
The score that matters is what the lender pulls during underwriting, not what you see on a free app. Lenders use credit scores from Equifax, Experian, or TransUnion — usually the middle score if three are pulled — and they may use older scoring models (FICO 2, 4, or 5) rather than the newest FICO 10. Your score can also shift between the time you start the process and the time you lock in a rate, so lenders often pull again before closing.
Key Takeaways
- Conventional loans usually require a minimum score of 620, but 640 to 660 opens better rates and terms.
- FHA loans can work with scores as low as 580, making them an option when your conventional score is too low.
- The lender's own requirements matter more than the loan type — two banks offering FHA loans may have different minimums.
- Your down payment size affects what score you need; a larger down payment can offset a lower score.
- The score lenders use during underwriting may differ from the score you see online, and it can change between application and closing.
How down payment size changes the score you need
A bigger down payment makes lenders willing to work with a lower score. On a conventional loan, putting down 20 percent or more usually requires a score around 620 to 640. Putting down 10 percent may push the minimum to 640 or 660. Putting down 5 percent or less often requires 680 or higher, and some lenders will not go below 700 for a 3 percent down payment.
FHA loans are more flexible on score but stricter on down payment. With a 580 score, you must put down at least 10 percent. With a 500 to 579 score (where available), the down payment jumps to 10 percent as well, but your interest rate and mortgage insurance costs rise significantly. The relationship works both ways: a 10 percent down payment with a 580 score is easier to find than a 3 percent down payment with a 620 score.
What happens if your score is below the lender's minimum
If your score is below 620 and you do not may have access to for FHA or VA loans, you have three paths. First, you can wait and rebuild your score — paying down debt, correcting errors on your credit report, and making on-time payments for several months can raise your score 20 to 100 points depending on what is dragging it down. Second, you can find a co-borrower with a stronger score; lenders average the scores of both applicants, so a co-signer can push you over the threshold. Third, you can look for a lender that specializes in lower scores — some credit unions and portfolio lenders (banks that keep loans rather than selling them) have minimums of 580 or 600 on conventional loans, though rates will be higher.
Do not assume your score is too low without asking. Some lenders pull scores differently or weight recent positive history more heavily. A score of 615 might be rejected by one bank and accepted by another. Call three to five lenders and ask their minimum before you spend money on a credit report dispute or wait months to rebuild.
How recent late payments and collections affect your chances
A low score is one problem; recent damage is another. A late payment from two years ago hurts less than one from two months ago. A collection account from five years ago is less damaging than one from six months ago. Most lenders want to see at least two years of clean payment history after a major negative event — a foreclosure, short sale, or bankruptcy — before they will approve you, regardless of your current score.
A single 30-day late payment on a credit card might drop your score 50 to 100 points but does not automatically disqualify you if your score is still above the lender's minimum. A charge-off or collection account is more serious; lenders often require that you pay it off or reach a settlement before approval. Ask the lender what they need to see: some will move forward if the account is paid in full, others want proof it was paid before you applied, and a few will not budge regardless.
Comparing credit score requirements across loan types
| Loan Type | Typical Minimum Score | Minimum Down Payment | Who Offers It |
|---|---|---|---|
| Conventional | 620–640 | 3–20% | Banks, credit unions, mortgage lenders |
| FHA | 580 (some 500) | 10% | Banks, credit unions, FHA-approved lenders |
| VA | 580–620 (lender-set) | 0% | VA-approved lenders, some banks |
| USDA | 620+ | 0% | USDA-approved lenders |
What score improvements actually matter during the home-buying process
If you are already in the application process, a 20-point score increase probably will not change your approval or rate. Lenders lock in your rate based on the score at application, and most do not re-rate you upward if your score climbs during underwriting. A 50-point jump might trigger a re-pull and a slightly better rate, but the difference is usually small — maybe 0.1 to 0.2 percent.
The time to improve your score is before you apply. If you have three months before you want to buy, paying down credit card balances (especially high-balance cards) and correcting errors on your credit report can move your score meaningfully. If you are applying next month, focus on not making things worse: do not open new accounts, do not miss a payment, and do not run up existing balances. A lender will pull your credit again before closing, and a new late payment or collection account can kill an approval even if your score stays the same.
Frequently Asked Questions
Can I get a mortgage with a 580 credit score?
Yes, through an FHA loan at most lenders, or through a VA loan if you are a veteran or active military. Some credit unions and portfolio lenders also offer conventional loans at 580, though rates will be higher and you may need a larger down payment or a co-borrower. Call lenders directly rather than assuming you are disqualified.
Does paying off debt before I apply help my score?
Paying off a collection account or charge-off can help because lenders often require it, but paying off a credit card does not always raise your score quickly. Your score depends partly on how much of your available credit you are using; paying down a card helps, but the score boost takes weeks to appear on your report. If you have time, pay down balances and wait for the report to update before applying.
What if I have no credit history at all?
No credit history is different from a low score. Most lenders cannot approve you without a credit file, but FHA loans sometimes work with alternative credit (utility bills, rent payments, insurance payments) if you have no traditional credit accounts. Ask an FHA lender whether they accept alternative credit before you open new accounts just to build a score.
Will a co-signer with a good score may provide my approval?
A co-signer with a strong score improves your chances significantly, but does not may provide approval. Lenders will also look at the co-signer's debt-to-income ratio and whether they have recent negative marks. The co-signer is equally responsible for the loan, so lenders treat them as seriously as they treat you.
Can I lock in a rate before my credit score is pulled?
No. Lenders pull your credit before they lock a rate because your score determines the rate itself. Some lenders offer a "rate lock" before pulling credit, but it is conditional — the lock holds only if your credit comes back at or above a certain score. Read the terms carefully; a conditional lock can disappear if your score is lower than expected.