Your credit score does not just determine mortgage approval — it determines your interest rate, which determines how much the home actually costs over 30 years.
Minimum scores by loan type
- Conventional: 620 minimum (720+ for best rates)
- FHA: 580 with 3.5% down; 500–579 with 10% down
- VA: No official minimum, most lenders want 620+
- USDA: Typically 640+
How your score affects your rate
The difference between a 680 and 760 credit score on a $350,000 mortgage can be 0.5–1.0% in rate. On a 30-year loan that translates to $36,000–$72,000 more in total interest. Same house, dramatically different cost.
Check all three bureaus first
Mortgage lenders typically use the middle of three bureau scores. Pull all three reports at AnnualCreditReport.com at least 3–6 months before applying — leaving time to dispute any inaccuracies.
How to improve your score before buying
- Pay down credit cards to under 10% utilization — fastest boost available
- Do not open new credit accounts in the 6–12 months before applying
- Set up autopay so no payments are missed
- Keep all existing accounts open — closing reduces available credit
The bottom line
If your score is below 720, waiting 6–12 months to improve it is often worth it. A 40-point improvement can save more over the loan life than years of expense cutting.