What credit score do you need to buy a home? The long-standing benchmark for loans backed by Fannie Mae and Freddie Mac is 620, and even that isn't a hard rule for every loan. Many buyers assume they need a higher score than they do.
Quick: what credit score do you need to buy a home? If a number came to mind, there's a good chance it's wrong.
The answer is also getting harder to pin down, because the way credit scores are calculated is changing, and for the better. Here's what you need to know.
1. Most People Are Guessing
Fannie Mae has tracked what consumers believe about mortgage requirements since 2015. Year after year, people overestimate the minimum credit score. As recently as 2023, the average guess was 652.
The actual long-standing benchmark for loans backed by Fannie Mae and Freddie Mac is lower, at 620. And today, even that isn't a hard rule for every loan they back.
A recent Veterans United survey found the same thing: consumers still overestimate what it takes to qualify.
Guessing wrong can cost you. A renter who assumes their score is too low may never find out they could already qualify.
2. The Rules Are Changing
For decades, the mortgage industry relied on one score: Classic FICO.
To increase competition, make credit scoring more inclusive, and help more people become homeowners, the Federal Housing Finance Agency (FHFA) has approved newer models, including FICO 10T and VantageScore 4.0.
A different model can produce a different score for the same person. VantageScore says its model can score about 33 million adults that Classic FICO can't.
So the score you saw on an app last month may not be the one your lender pulls. The models are new, but the basics haven't changed.
3. Do Your Part, and Partner with a Pro
Your credit matters no matter how it's measured. The same habits help under the old and new models:
Pay every bill on time.
Keep credit card balances low.
Don't open a lot of new credit at once, especially before or during a home purchase.
Keep older accounts open to preserve your credit history.
Check your credit reports for errors and dispute anything that's wrong.
Consistency goes a long way. Small habits, repeated over time, build a stronger profile.
Frequently Asked Questions
What is the minimum credit score to buy a house?
The long-standing benchmark for loans backed by Fannie Mae and Freddie Mac is 620, but it isn't a hard rule for every loan. Other loan types have their own guidelines. A lender can tell you what you qualify for.
Why is my lender's credit score different from my app?
Lenders and apps may use different scoring models. With newer models like FICO 10T and VantageScore 4.0 now approved, your score can vary depending on which one is used.
How can I improve my credit to buy a home?
Pay bills on time, keep balances low, avoid opening new credit before you buy, keep older accounts open, and check your reports for errors.
Talk to a Pro Before You Decide
Don't make credit or homebuying decisions based on a chart, an app, or a friend's advice. With the rules shifting, it's never too early to talk with a loan officer about your credit, your budget, and what it would take to qualify.
You may be closer to owning a home in San Diego County than you think. If you need a lender recommendation or want to talk through your plans, call or text me.
Billie Bourgeois | REALTOR® Real Broker | San Diego County, CA DRE# 01703336
