While credit score requirements vary based on loan type, lenders generally require a credit score of at least 620 to buy a house with a conventional mortgage.
The minimum credit score needed to buy a house can range from 500 to 700, but will ultimately depend on the type of mortgage loan youre applying for and your lender. While its possible to get a mortgage with bad credit, you typically need good or exceptional credit to qualify for the best terms.
Read on to learn what credit score youll need to buy a house and how to improve your credit leading up to a mortgage application.
Having a credit score of 757 puts you in excellent credit territory, meaning you should have a good chance of qualifying for a mortgage to buy a house. However, there are a few key factors to keep in mind.
What Credit Score Is Needed to Buy a House?
In most cases, you’ll need a minimum credit score of 620 to qualify for a conventional mortgage with decent interest rates. However, requirements vary depending on the mortgage program
- Conventional loans – 620 minimum credit score required in most cases. 760+ recommended for the very best rates.
- FHA loans – 500 minimum credit score if you make a 10% down payment. 580 minimum with 3.5% down.
- VA loans – No official minimum but most lenders require 620+ scores.
- USDA loans – No defined minimum but scores of 580-620 typically required.
- Jumbo loans – Due to higher loan amounts, you’ll generally need at least 700.
While the minimum can be as low as 500 for certain government-backed mortgages, your interest rates improve significantly once you reach the mid-700s.
How Does a 757 Credit Score Fare for Mortgage Rates?
A credit score of 757 is in the “very good” range, according to the FICO scoring model. This means you should qualify for competitive interest rates from most lenders.
As an example, here are average 30-year fixed mortgage rates by credit score range as of July 2024
- 760-850 – 6.237% APR
- 700-759 – 6.459% APR
- 680-699 – 6.636% APR
- 660-679 – 6.85% APR
- 640-659 – 7.28% APR
- 620-639 – 7.826% APR
With a score of 757, you’d likely fall into the 700-759 range above, qualifying you for an average rate of 6459% right now That’s over 1.3 percentage points lower than if you had a bottom-tier score of 620-639.
This difference can save you tens of thousands of dollars in interest charges over the life of your mortgage.
Other Factors Lenders Consider With Mortgage Applications
While your credit score plays a significant role, lenders will look at other criteria when reviewing your mortgage application, including:
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Down payment amount – The more you can put down, the lower your rate may be. 20% down avoids private mortgage insurance (PMI).
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Debt-to-income ratio – Your total monthly debt divided by gross income. Most want this below 43%.
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Credit history – Foreclosures, bankruptcies, and other major issues can outweigh your high credit score.
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Work history – Stable income sources and longer job tenure may help your case.
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Assets and reserves – Extra assets and cash reserves show financial stability.
A higher credit score can help offset other application weaknesses, but underwriters still examine your full financial picture.
Can I Get a Mortgage With a Score Lower Than 757?
Absolutely. Here are some tips for getting approved if your credit score is below 757:
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Shop for lenders willing to approve lower scores. Online lenders tend to be more flexible than banks.
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Apply for an FHA loan. They only require 500+ credit scores.
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Make a larger down payment if possible. This offsets the higher risk of a lower score.
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Reduce other monthly debts to improve your debt-to-income ratio. Pay down credit cards and other balances.
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Add a co-signer with better credit, but make sure they recognize the obligation.
While mortgage lenders have become more flexible with credit requirements in recent years, you’ll always pay a price for having less-than-perfect credit. Make it a priority to improve your score before applying if you can.
How to Improve Your Credit Score Before Buying a House
If you have time before you need to buy a house, take steps to boost your credit score even more. This can help you land better mortgage rates and terms. Here are some tips:
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Review your credit reports and dispute any errors you find. Mistakes can drag down your score.
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Pay all bills on time each month. Payment history is the biggest factor in your credit score.
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Pay down credit card and other revolving balances. High balances hurt your credit utilization ratio.
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Limit new credit applications in the months preceding your mortgage application. Too many can be seen as riskier.
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Set up automatic bill payments so you never miss deadlines. Even one late payment can damage your score.
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Monitor your credit score regularly so you can catch issues before they grow.
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Maintain low credit card balances and avoid unnecessary debt.
Patience and diligently building your credit history over time is rewarded when you go to buy a home. Don’t wait until the last minute to check on your credit score status.
The Takeaway: 757 Credit Score Is Great for Mortgage Qualification
A 757 credit score puts you well within the “good to excellent” credit range needed to qualify for a competitive mortgage rate. While it’s not a guarantee, this score means you should have a high approval probability when applying for a home loan.
Just keep in mind lenders look at all aspects of your financial profile, not just your credit score. But maintaining scores of 757 and higher will put you in a strong position as a mortgage applicant. Monitor your credit, pay bills on time, and limit new credit applications as you get ready to buy your dream home.
Conventional Loans Minimum Credit Score: 620
Conventional loans typically require a minimum credit score of 620, though some may require a score of 660 or higher. These loans arent insured by a government agency and conform to certain standards set by the government-sponsored entities Fannie Mae and Freddie Mac. Theyre by far the most commonly used mortgage loans.
Can You Get a Mortgage With a Bad Credit Score?
Its possible to get approved for a mortgage with poor credit. But just because you can, it doesnt necessarily mean you should because even a small increase in your interest rate can cost you tens of thousands of dollars over the life of a mortgage loan. If youre not in a rush and can take time to improve your credit before applying for a mortgage, it could be well worth it (more on this below).
If youre set on buying a home soon and you have bad credit, here are a few tips that can help you potentially score a decent interest rate:
- Consider an FHA loan. With 10% or more down, you could get approved with a score as low as 500.
- Minimize other risks. Options may include making a larger down payment, paying down credit card balances to reduce your credit utilization rate or paying off other debts to lower your DTI.
- Shop around. Take some time to get preapproved with multiple lenders to get an idea of whats available based on your credit situation. You could even consider working with a mortgage broker who may be able to match you with a specialized loan program.
- Get a cosigner. Consider asking someone with good or exceptional credit to apply with you as a cosigner. Just make sure you discuss the implications of cosigning a mortgage loan before you proceed.
Theres no guarantee that these actions will help you qualify for a mortgage loan with good terms, but they can improve your odds.
Learn more: How to Get a Home Loan With Bad Credit
Minimum Credit Score to Buy a House | Retail Mortgage
FAQ
Is 757 a good credit score to buy a house?
Your credit score (commonly called a FICO ® Score) can range from 300 at the low end to 850 at the high end. A score of 740 or above is generally considered very good, but you don’t need that score or above to buy a home.
How big of a loan can I get with a 750 credit score?
What can a 757 credit score get you?
| Type of Credit | Do You Qualify? |
|---|---|
| Credit Card | YES |
| Personal Loan | YES |
| Auto Loan | YES |
| Home Loan | YES |
What is the minimum credit score to buy a house?
You generally need a credit score of at least 620 to qualify for a conventional mortgage, though every lender is different. It’s possible to qualify for an FHA loan, which is backed by the federal government, with a credit score as low as 500.
Is a 757 credit score good?
Editorial Note: Credit Karma receives compensation from third-party advertisers, but that doesn’t affect our editors’ opinions. Our third-party advertisers don’t review, approve or endorse our editorial content. It’s accurate to the best of our knowledge when posted. A 757 credit score is often considered very good — or even excellent.
Do you need a credit score to buy a house?
Your credit score is one of the most important factors lenders look at when you apply for a mortgage loan. Different types of loans have different minimum credit score requirements. Typically, the higher your credit score is, the lower an interest rate you will qualify for. Strictly speaking, you don’t need a credit score to buy a house.
What is the average utilization rate for a 757 credit score?
Among consumers with FICO ® credit scores of 757, the average utilization rate is 31.8%. The best way to determine how to improve your credit score is to check your FICO ® Score. Along with your score, you’ll receive information about ways you can boost your score, based on specific information in your credit file.
What is a good credit score to buy a house?
A favorable credit score to buy a house is typically in the high 600s and 700s. Anything higher than that is considered “exceptional”, and helps borrowers get the very best mortgage rates. Certain loan types even allow you to buy a house with a credit score as low as 500.
Can you buy a house with a low credit score?
But if one applicant has a low credit score, you may consider applying for the loan using only the applicant with a healthy credit score. If you omit one applicant’s credit score, you must also omit their income from the application. What is a good credit score to buy a house? A good credit score to buy a house is 720 or higher.
Can you buy a house with a 580 credit score?
Lenders may not be able to re-sell loans given to borrowers with credit scores less than 620, possibly as low as 580. So even though FHA requirements will allow 500 to 580 as a minimum credit score, a minimum range of 580 to 620 is more realistic for prospective FHA borrowers. The minimum credit score to buy a house with a VA loan is 580 to 620.