What Credit Score Do You Need to Buy a House?

Your credit score can mean the difference between getting approved for a mortgage and being denied — or between a 6.5% rate and a 7.5% rate on a $400,000 home loan. That 1% difference is $240/month or $86,400 over 30 years. Your score matters enormously.

Minimum Credit Scores by Loan Type (2025)

• Conventional loan (Fannie Mae/Freddie Mac): 620 minimum, 740+ for best rates
• FHA loan (government-backed, 3.5% down): 580 minimum (500–579 with 10% down)
• VA loan (veterans only): No official minimum, but most lenders want 620+
• USDA loan (rural areas): 640 minimum for most lenders
• Jumbo loan (over $766,550): Typically 700–720 minimum

How Your Score Affects Your Rate

Example: $350,000 conventional mortgage, 30-year fixed. Score 620: ~7.8% rate, $2,511/month. Score 680: ~7.2% rate, $2,381/month. Score 740+: ~6.8% rate, $2,291/month. The difference between 620 and 740 is $220/month or $79,200 over the life of the loan.

How to Improve Your Score Before Applying

• Pay every bill on time for 6–12 months — payment history is 35% of your score
• Pay down credit card balances to under 30% utilization (ideally under 10%)
• Don't close old credit cards — length of history helps your score
• Don't open new credit accounts in the 12 months before applying
• Dispute any errors on your credit report (1 in 5 reports contain errors)

Timeline to Improve Your Score

• 1–2 months: Pay down credit card balances significantly (fastest impact)
• 3–6 months: Consistent on-time payments start showing in score
• 6–12 months: Dispute removal of errors, thin credit history starts to grow
• 12–24 months: Significant improvement possible from 580→680+ range