What Credit Score Do You Actually Need to Buy a House?

You've been doom-scrolling Zillow for months. You've got a savings goal pinned to your fridge. But there's one number quietly running the show behind the scenes — your credit score.

Here's the thing: you don't need a perfect credit score to buy a house. You don't even need a great one. But the score you walk in with will directly shape how much that house actually costs you over time. Let's break down what the minimums really are, what lenders care about beyond the number, and how to get yourself in the best position before you apply.

What Are the Minimum Credit Scores by Loan Type?

Different loan programs have different floors. Here's what you're working with:

• Conventional loans — Typically require a minimum score of 620. These are the standard loans backed by Fannie Mae and Freddie Mac, and they reward higher scores with better rates.
• FHA loans — You can qualify with a score as low as 500, but there's a catch. With a score between 500 and 579, you'll need a 10% down payment. Hit 580 or above, and that drops to 3.5% down.
• VA loans — Technically, the VA doesn't set a minimum credit score. But most lenders impose their own floor, usually around 620. If you're a veteran or active-duty service member, this is one of the best loan products out there.
• USDA loans — Designed for rural and suburban buyers, these generally look for a score of 640 or higher.

The takeaway: A 580 score can get you into a home. But the real question isn't can you buy — it's what will it cost you?

How Does Your Credit Score Affect Your Interest Rate?

This is where it gets expensive. Your credit score doesn't just determine approval — it determines how much you pay every single month for the life of the loan.

Let's say you're buying a $300,000 home with a 30-year fixed mortgage:

• With a score around 760+, you might lock in a rate near 6.5%. Your monthly payment (principal and interest) lands around $1,896.
• With a score around 660, that rate could jump to 7.5% or higher. Now you're paying roughly $2,098 per month.

That's a difference of about $200 per month, or over $72,000 across the life of the loan — just because of your credit score. Not the house. Not the neighborhood. The score.

Even a 0.5% rate difference adds up to tens of thousands over 30 years. If you're on the edge, spending a few months improving your score before applying could literally save you a down payment's worth of money.

What Do Lenders Actually Look at Beyond Your Score?

Your credit score gets you in the door, but lenders dig deeper. Here's what else is on their radar:

• Debt-to-income ratio (DTI) — Lenders want to see that your total monthly debt payments (including the new mortgage) stay below about 43-45% of your gross income. If you're carrying a lot of student loans or car payments, this ratio matters just as much as your score. If you're weighing whether to tackle debt first, check out should you pay off debt or save first.
• Employment and income stability — They typically want to see at least two years of consistent employment. Freelancers and gig workers can qualify, but expect to provide more documentation.
• Down payment and reserves — More cash down means less risk for the lender. Having two to three months of mortgage payments saved as reserves after closing also strengthens your application. Building that cushion starts with an emergency fund strategy.
• Credit history depth — A thin file (few accounts, short history) can hurt you even with a decent score. Lenders like to see a track record of managing different types of credit responsibly.

How Can You Improve Your Score Before Applying?

If you're not where you need to be yet, don't panic. Credit scores are buildable, and targeted moves can shift yours meaningfully in three to six months:

• Pay down credit card balances — Your credit utilization ratio (how much you owe versus your limits) is the fastest lever to pull. Aim to get below 30%, and ideally below 10%, on every card.
• Don't open new accounts — Each new application triggers a hard inquiry and lowers your average account age. Hold off on new cards or loans in the months leading up to your mortgage application.
• Dispute any errors on your report — Pull your reports from all three bureaus at AnnualCreditReport.com. Errors are more common than you'd think, and removing one can bump your score overnight.
• Keep old accounts open — Even if you're not using a card, closing it shortens your credit history and raises your utilization. Let it sit.
• Become an authorized user — If a family member has a long-standing account with perfect payment history, getting added as an authorized user can give your score a boost without any spending required.

So When Should You Actually Apply?

There's no single magic number. But if you're sitting below a 620 and you're not pursuing an FHA loan, it's worth the patience to build up first. The money you save on interest will dwarf the cost of waiting a few extra months.

If you're above 700, you're in a strong position. Above 740, you're likely qualifying for the best rates available.

Whatever your number is today, the move is the same: know where you stand, make a plan, and start building. Your future self (and future mortgage payment) will thank you.

Ready to get your full financial picture in order before house hunting? Explore our step-by-step guides to build a strategy that works for your life.