Credit Score for a Mortgage

Buying a home is the single largest financial transaction most people make. Your credit score determines not just whether you're approved, but what interest rate you'll pay — and that rate difference compounds over 15-30 years into a staggering amount of money.

Minimum Credit Scores by Loan Type

• FHA Loan: Minimum 580 with 3.5% down. 500-579 requires 10% down.
• Conventional Loan (Fannie Mae/Freddie Mac): Minimum 620. Best rates start at 740+.
• VA Loan: No official minimum from the VA, but most lenders want 620+.
• USDA Loan: Minimum 640 for most lenders.
• Jumbo Loan: Typically 700+ for loan amounts above conforming limits.

Which Score Do Mortgage Lenders Use?

Mortgage lenders pull all three bureau reports and use your middle score. If your scores are 680, 700, and 720, they use 700. They use specific FICO versions: FICO 2 (Experian), FICO 4 (TransUnion), and FICO 5 (Equifax). These are older models that may differ from the score you see on free apps.

How Your Score Affects Your Rate

On a $350,000 30-year fixed mortgage:

The difference between 580 and 760: roughly $191,880 in additional interest over 30 years. That's why credit repair before buying is one of the highest ROI financial decisions you can make.

Preparing Your Credit for a Mortgage

Start at least 6-12 months before you plan to apply:

1. Pull all three reports and check for errors
2. Dispute any inaccuracies
3. Pay down credit card balances to under 10% utilization
4. Don't open new accounts — no new credit cards, auto loans, or other credit in the months before applying
5. Don't close old accounts — it hurts credit age and utilization
6. Pay everything on time — one missed payment can delay your home purchase
7. Keep your DTI under 43% (ideally under 36%)

What About After Bankruptcy or Foreclosure?

Waiting periods apply:

• Chapter 7 bankruptcy: 2-4 years for FHA/VA, 4-7 for conventional
• Chapter 13: 1-2 years for FHA/VA (from discharge), 2-4 for conventional
• Foreclosure: 3 years FHA, 7 years conventional (with exceptions)

Start rebuilding immediately so your score is ready when the waiting period ends.

Results vary based on individual credit profiles and are not guaranteed.