One of the most common questions I get from homebuyers is: What does my credit score have to be to qualify for a mortgage? The short answer is that it varies—but there are some general guidelines that apply across the board. 

Let’s break it down using Fannie Mae and Freddie Mac guidelines, as well as FHA guidelines, so you can get a good idea of where you stand. 

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🏦 What Credit Score Do I Need? 

Your credit score plays a big role in whether you can qualify for a mortgage and what kind of  interest rate  you’ll get. Different lenders might allow for different scores, but in general: 

  • The standard minimum credit score for most loan programs is  580  or higher. 

However, the higher your credit score, the  better your chances  of getting a  lower interest rate  and better terms on your loan. Here’s how it breaks down: 

1. FHA Loans (Federal Housing Administration) 

  • The minimum credit score requirement for an FHA loan is generally 580 or higher. 
  • FHA loans are often the go-to option for first-time homebuyers or buyers with less-than-perfect credit. This is because they’re more forgiving than conventional loans. 
  • If your score is between 500–579, you may still be able to get an FHA loan, but you’ll need to put down at least 10% of the home’s purchase price. 

2. Conventional Loans (Fannie Mae & Freddie Mac) 

  • For Conventional loans, you’ll typically need a credit score of at least 620. However, many lenders prefer scores above 680–700 to offer better rates and terms. 
  • Conventional loans tend to have stricter requirements than FHA loans. This is why they often require higher credit scores and larger down payments. 

📊 Why Does a Higher Credit Score Matter? 

The short answer: Interest rates. The higher your credit score, the more likely you are to qualify for a lower interest rate. That means lower monthly payments and less money paid in interest over the life of the loan. 

Let’s look at an example. If you qualify for a 4% interest rate with a 700+ score, but someone else with a 620 score only qualifies for a 5% rate, here’s the difference on a $250,000 loan: 

Credit Score Interest RateMonthly Payment (Principal + Interest) Total Interest Paid Over 30 Years 
700+ 4% $1,193.54 $186,474 
620 5% $1,342.05 $223,339 

As you can see, a higher credit score can save you thousands of dollars over the life of your loan. Credit scores matter a lot when it comes to getting a good deal on your mortgage! 

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🔑 How Do FHA and Conventional Loans Differ in Terms of Credit Scores? 

When it comes to FHA loans versus Conventional loans, the primary difference is the credit score requirement. 

  • FHA Loans: These are more flexible and designed for buyers with lower credit scores. A  580  score (or even a  500–579  score with a 10% down payment) may still get you approved for an FHA loan. However, if your credit score is low, your interest rate might be higher, and you may be required to pay  mortgage insurance  for the life of the loan. 
  • Conventional Loans: These loans typically require  higher credit scores  (at least  620  or better). If your credit score is higher, you’re likely to get a  lower interest rate, and you won’t have to pay  mortgage insurance  if you put down at least  20%. Conventional loans also offer more options for private mortgage insurance (PMI), which can be canceled once you build enough equity. 

📝 Quick Breakdown of Credit Scores for Different Loan Types 

Loan Type Minimum Credit Score Down Payment Requirement Mortgage Insurance 
FHA Loan 580 or higher 3.5% Required (until 20% equity) 
Conventional 620 or higher 3%–5% Required (unless 20% down) 
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📉 What Happens If My Credit Score Is Below 580? 

If your credit score is below  580, it can be much harder to get approved for a mortgage through  Fannie Mae, Freddie Mac, or  FHA. If you fall into this category, here are a few things to consider: 

  • FHA  is generally your best bet, but even then, you’ll need to have a  larger down payment  (at least  10%). 
  • Some  subprime lenders  may be willing to work with you if your score is below 580, but expect to face  higher interest rates  and stricter terms. 
  • If you’re in this situation, it might be worth taking some time to improve your credit score before applying, as doing so could save you money over the long term. 
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Final Thoughts 

Your credit score plays a major role in your ability to qualify for a mortgage and the interest rate you’ll receive. In general: 

  • FHA loans  are more flexible and can be a good option if your score is in the  580–620  range. 
  • Conventional loans  usually require a score of  620 or higher  and typically offer better interest rates for higher scores. 

If you’re unsure about your credit score or which loan is best for you, I’d be happy to help you figure it out! The higher your credit score, the more money you can save, so it’s definitely worth checking where you stand. 

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