What Credit Score Do You Need to Buy a House?

Buying a home is one of the biggest financial moves you’ll ever make, and your credit score plays a huge role in the process. It influences whether you qualify for a mortgage, how much you can borrow, and the interest rate you’ll pay.

But here’s the truth: there isn’t one “magic number.” The credit score you need to buy a house depends on the type of loan you’re applying for. In this guide, we’ll break down the minimum requirements for FHA, VA, USDA, and conventional loans, and show you what score gives you the best chance at securing the lowest rates.

So, What Is a Good Credit Score to Buy a House?

A “good” credit score to buy a house is one that helps you secure a competitive interest rate and favorable loan terms. While you can qualify for a mortgage with a score as low as 500 (FHA), most conventional lenders look for at least 620.

Here’s how credit score ranges are generally viewed by lenders:

Minimum Credit Score Requirement by Mortgage Loan Type

Different mortgage programs have different credit score requirements. Here’s a side-by-side comparison:

How Do Mortgage Lenders Determine Your Credit Score?

When you apply for a mortgage, lenders don’t just pull one score; they typically review your FICO® Scores from all three major credit bureaus: Experian, Equifax, and TransUnion. Each bureau may have slightly different data, which means your score can vary.

Here’s how it usually works:

• Three scores pulled: One from each credit bureau.
• Middle score matters most: Lenders typically use your middle score (not the highest or lowest) when making a decision.
• Both borrowers’ scores count: If you’re applying with a co-borrower, lenders usually consider the lower median score between the two applicants.

This process helps lenders get a balanced view of your creditworthiness, reducing the impact of one unusually high or low score.

Tips for Increasing Your Credit Score Prior to Buying a House

If your credit score isn’t quite where you’d like it to be, don’t panic. Improving your score is possible, and even small changes can have a big impact on your mortgage eligibility and interest rate. Here are proven ways to boost your score before applying for a home loan:

1. Pay Bills on Time

Your payment history makes up about 35% of your credit score. Just one missed payment can lower your score significantly, especially if it’s 30 days late or more. Setting up automatic payments or reminders ensures you never miss a due date.

2. Lower Credit Utilization

Credit utilization is the ratio of your credit card balances to your credit limits. Lenders like to see you using less than 30% of your available credit, ideally closer to 10%. Paying down existing balances or asking for a credit limit increase (without adding new debt) can improve this factor quickly.

3. Avoid New Credit Applications

Every time you apply for new credit, a hard inquiry shows up on your report, which can temporarily ding your score. Opening several new accounts at once also lowers your average account age, another scoring factor. Unless absolutely necessary, hold off on applying for new credit until after your mortgage closes.

4. Check Your Credit Report for Errors

Mistakes happen, from incorrect balances to accounts that don’t belong to you. Reviewing your credit report regularly can help you spot and dispute errors with Experian, Equifax, or TransUnion. A corrected error could add valuable points to your score.

5. Build Positive History

If your credit file is thin or you’re rebuilding, tools like secured credit cards or rent-reporting services can help establish a consistent record of on-time payments. The longer your positive history, the stronger your score will be when lenders review it.

Additional Factors That Impact Your Loan Approval

Your credit score is a critical piece of the puzzle, but lenders look at your overall financial picture before approving a mortgage. Here are other key factors they evaluate:

Debt-to-Income Ratio (DTI)

Your DTI compares your monthly debt payments (credit cards, student loans, car loans) to your monthly income. Most lenders prefer a DTI under 43%, but lower is better. A lower DTI shows you’re not overextended and can comfortably handle a mortgage payment.

Employment History

Lenders like stability. Having steady employment for at least two years in the same field demonstrates consistent income. Frequent job changes or gaps in employment may raise questions, unless you can show an upward career trajectory.

Down Payment

The size of your down payment directly affects your approval odds. A larger down payment lowers the lender’s risk, which may allow you to qualify with a lower credit score or higher DTI. It can also reduce or eliminate the need for private mortgage insurance (PMI).

Cash Reserves

Many lenders want to see that you have savings or liquid assets left over after closing. Having at least two to six months’ worth of mortgage payments in reserve reassures lenders that you can keep paying your loan if your income is disrupted.

Bottom Line

Ultimately, the credit score needed in order to qualify for a home loan depends on the type of loan you’re trying to apply for. The higher the credit score you have, the easier it will be to qualify and the better the rates you will get.

If purchasing a home is in your near future plans, make sure to stay on top of that credit score! There are plenty of free sites, such as Credit Karma, that allow you to check your credit score for free at any time.