What is a good credit score to buy a house?
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What’s a good credit score to buy a house?
If you want to buy a new house with a mortgage, first of all, you should take a look at your credit score from the bank system. There are some minimum scores but generally, it depends on your credit circumstance on the financial sector.
If we go through FHA credit score requirements, we will see that 580+ credit score with 3.5% down payment is needed. If your score is low like 500-579, you will see a 10% down payment status.
When you apply to credit, lender will look at the Fico score. If your score is enough you get the loan. Additionally, other factors can affect your loan status but score is determinant generally.
So the lowest credit score will change according to your home loan type. If you want to get a big home, a little score will not be enough. You should also have other sufficiencies like car or your job kind. And monthly salary of course.
Average credit score to get a home loan
Average Fico scores as follows:
- Conventional Loan needs 620 plus score
- FHA 203K Loan needs 620 plus score (Federal House Administration)
- VA Loan needs 620 plus
- USDA Loan needs 640 plus
- FHA Loan needs 580 plus score (Federal House Administration)
Lowest credit score to buy a home
You may think that you are not enough about credit for a house but this is not true because FHA loan kind does not want high requirements. So if you have a low credit score, you should directly apply to FHA loan.
However, if your credit score is between 500-579, unfortunately your credit chance will be low.
When you have 580 and plus Fico score, your down payment will be 3.5%. So you should keep your score over 580. This is the most important point on FHA ((Federal House Administration) Loan.
Credit score ranges to get a home loan
Now we want to give your some credit score ranges. Thus you can measure your status by yourself easily. Details below:
- 500-579 means very low credit score
- 580-619 means low score
- 620-679 means fair score
- 680-739 means average credit score for loan
- 740 and plus means good credit score
If you want to improve your credit score, you should pay your credit card, regularly. Also you should have a good salary. Salary will be important by getting a loan. If your registry is clear and score is higher than 580, FHA loan awaits you. Credit score improving methods and other loan articles available on our web site.
