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For a conventional mortgage loan, you typically need a credit score of 620 or higher to indicate that you are likely to repay your debt on time and get approved. However, there are other types of loans that may be available for people with lower scores. In addition, with a higher score, you may qualify for more favorable rates and terms.

For many, buying a home is a huge financial step, representing the biggest purchase they’ll ever make in their life. Read on to learn more about how your credit score impacts your ability to access a home loan and which terms are available to you.

Average Credit Score to Buy a House

About 70% of mortgages are conventional loans, making these far and away those most common mortgage type. For a conventional mortgage, lenders will typically require a minimum credit score of 620. That said, on average, homebuyers had a credit score of 758 in 2024, considerably higher than the required minimum.

On the topic of credit scores, here’s how the FICO® Score, a popular credit-scoring model, arranges its credit score ranges:

•   300-579: Poor

•   580-669: Fair

•   679-739: Good

•   740-799: Very good

•   800-850: Exceptional or excellent

Recommended: What Is the Starting Credit Score?

What Credit Score Do I Need to Buy a House?

As mentioned above, the credit score you need to buy a house will vary depending on the loan type you apply for. In general, necessary credit scores will range from 500 to 700. The higher the score, the easier it generally is to secure credit and qualify for favorable terms and interest rates.

Minimum Credit Scores by Home Loan Type

There are several different types of home loans you may apply for depending on your circumstances, including conventional loans, jumbo loans, FHA loans, VA loans, and USDA loans. Each type of loan has a different minimum credit score requirement.

Conventional Loans Minimum Credit Score

A conventional loan is a home loan that is backed by private lenders. It is not backed or insured by the government. This is the most common type of home loan and usually requires a minimum credit score of 620. If your credit score is higher than that (say, in the very good or excellent ranges), you may qualify for lower interest rates and better terms.

Jumbo Loans Minimum Credit Score

Jumbo loans are loans that are too big to be covered by conventional loans as determined by the Federal Housing Finance Agency (FHFA). According to the FHFA, in 2025, loans bigger than $806,500 require a jumbo loan in most counties. Jumbo loans usually have a minimum credit score of 700, one of the highest credit score thresholds among mortgage options.

FHA Loans Minimum Credit Score

A Federal Housing Administration, or FHA, loan is one that is backed by the federal government. This program helps make buying a house more affordable for families with low or moderate incomes. Government backing means these loans may be extended to individuals who would otherwise likely be seen as risky by conventional lenders. FHA loans typically have a low minimum credit score requirement of 500 with a 10% down payment and a 580 credit score with a 3.5% down payment.

VA Loans Minimum Credit Score

A VA loan is partially guaranteed by the Department of Veterans Affairs. They are available to veterans, service members, and their families, and some lenders will require a minimum credit score of 620. That said, there is no official minimum credit score requirement, so you may be able to access a VA loan with a lower score. If that is your situation, you may have to provide additional documentation in order to be approved.

USDA Loans Minimum Credit Score

USDA loans are guaranteed by the U.S. Department of Agriculture and are available in certain individuals in rural areas. They often look for a minimum credit score of 580, but as with VA loans, there isn’t a strict requirement. You might qualify for a USDA loan with a lower score if a lender reviews your financials and determines you are creditworthy.

Related: The 52 Week Savings Challenge

How Your Credit Score Affects Mortgage Rates

Your credit score is a three-digit representation of your credit history. Higher scores demonstrate that you have been responsible with your credit, paying bills on time and avoiding taking on more debt than you can manage. Lenders see potential borrowers with high scores as being less risky than those with lower scores. If you’ve managed credit wisely in the past, you may well do so again in the future.

As a result, lenders may offer borrowers with high scores credit with better terms and lower interest rates. Lenders may also extend credit to borrowers with lower scores. However, to compensate for the extra risk they are taking on, they may charge higher interest rates, which increases the overall cost of borrowing.

Here’s an example of mortgage interest rates for conventional loans by credit score as of mid-2024:

•   Those with a credit score of 760-850 would have a 6.976% APR

•   Those with a credit score of 660-679 would have a 7.589% APR

•   Those with a credit score of 620-639 would have an 8.565% APR

While these differences among rates may not sound huge, over the life of a loan, an additional percent or so in interest can really add up.

Other Factors Mortgage Lenders Consider

In addition to your credit score, lenders will also likely look at some other factors:

•   Your employment status and income. They may want to see that you have a steady stream of cash to pay your monthly mortgage bill.

•   How much money you have for a down payment. The more money you put down, the less risk the lender has to take on. As a result, higher down payments may help you qualify for loans and lower interest rates.

•   Other assets you have that could be used to make debt payments in case you don’t have enough income.

•   The value of any other property you own.

•   Your debt-to-income ratio (DTI). This is a comparison of how much debt you owe versus how much money you have coming in. It’s a quick way to let lenders know whether you have enough income to cover your liabilities.

Can You Get a Mortgage With a Bad Credit Score?

The lowest credit score category is poor, which ranges from 300 to 579. With a score in this range, you may not qualify for a conventional loan.

However, you can get a mortgage with a low credit score as long as it meets minimum score requirements. A government-backed loan may be your best bet, since some lenders may approve a borrower with a credit score below 580 (say, 500 and up). That said, you may pay more in interest than those with higher scores. You might prefer to wait and build your score before applying for a home loan.

How to Build Your Credit Before Getting a Mortgage

It may be worthwhile to build your credit before you apply for a loan. There are several factors that affect your credit score.

One of the best ways to build your credit score can be to always pay your bills on time. This is the number-one factor in determining the most common credit scores, including FICO and VantageScore.

The second biggest factor is your credit utilization rate, or how much of your available credit you’re using. In general, the less the better. Lenders typically prefer that you use no more than 30% of your available credit. Pay down debt to lower your utilization rate and raise your score.

Recommended: How Long Does It Take to Build Credit?

Factors in Mortgage Preapproval

A mortgage preapproval is a statement from a lender that you are likely to qualify for a mortgage. It can be a helpful document to show sellers as it can demonstrate that you are serious about making a purchase and likely to receive financing.

For a preapproval, lenders typically look at such factors as credit score, income, assets, DTI, and employment verification. Thanks to this financial review, being preapproved can give you a sense of confidence about your ability to go house shopping.

Credit Score Tips

Your credit score is not static. It changes over time, and your score may vary depending on the scoring system used.

The credit reporting bureaus update your score after anything happens that affects your credit. So if you are late with a payment or if your credit utilization climbs higher, you may see your score drop. On the other hand, if you were to lower your credit utilization, you might positively impact your score. These actions can all help build your score: paying your bills on time, every time; managing your credit utilization; not applying for too much credit in a short period of time; having a good mix of credit; and maintaining a longer credit history.

It’s also important to monitor your credit score and regularly examine your credit report for errors. (You can check your credit report without paying each week from each of the credit reporting bureaus: Experian®, Equifax®, and TransUnion®.)

If you catch a mistake, dispute the error with the credit reporting bureau immediately to prevent it from dinging your score.

You may be able to build a stronger credit score with the help of healthy financial habits, such as budgeting and saving regularly, which can help you stay out of debt and manage payments. You might use spending apps and money tracker apps in this pursuit. A good place to start: See what your financial institution offers. You can also search online for third-party tools.

Recommended: Why Did My Credit Score Drop After a Dispute?

The Takeaway

Your credit score can impact the type of loans you qualify for, as well as the terms and interest rates lenders may offer. For a conventional home loan, you will typically need a score of 620 or higher, and a score of 700 and up for a jumbo loan. Government-backed loans, such as FHA, VA, and USDA loans, however, may accept credit scores in the 500s. Those with lower scores will typically pay higher interest rates.

While you may qualify for a loan with the minimum required credit score, it may be beneficial to monitor and build your score before taking out a loan to reduce the overall cost of borrowing.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

FAQ

What is a decent credit score for buying a house?

On average, homebuyers had a credit score of 758 in 2024, but you may be able to qualify for a loan with a lower score. Typically, conventional loans are available to those with scores of 620 and up. Usually, higher scores can give access to more favorable rates and terms.

Can you buy a house with a 600 credit score?

With a credit score of 600, you may be able to qualify for a government backed loan, such as an FHA, VA, or USDA loan. Or you might choose to wait and build your score to 620 or higher, which could then give you access to a conventional home loan.

How much house can I afford if I make $70,000 a year?

There are several rules of thumb about how much to spend on housing each year. One common one is that you shouldn’t spend more than 30% of your gross income each month on housing costs including your mortgage and property taxes. That works out to a mortgage payment of about $1,650 each month. You can then use online mortgage calculators to explore how much you can borrow to fit this monthly budget. In some tight housing markets, people may spend more. In fact, one recent study found that more than 20% of homeowners indeed exceeded this amount.

What credit score is needed to buy a $400,000 house?

Securing a mortgage isn’t just a matter of your credit score versus how much the prospective home costs. Several factors will be evaluated by lenders in addition, such as down payment amount, income, and more. For a conventional loan, you likely need a credit score of 620 or higher, while you may access a government-backed loan with a lower score (say, 500 and above) if you meet certain criteria.

Is a 580 credit score good enough to buy a house?

With a credit score of 580, you may qualify for an FHA, VA, or USDA loan. You can work with online tools and specific lenders to see what your odds of qualifying are or seek out preapproval.

How much income do I need for a 300K FHA loan?

The income you need will vary depending on the lender guidelines and other factors, such as down payment funds you may have available, your credit score, and more. It could be helpful to discuss your qualifications with a lender or use an online calculator to see what you could qualify for.

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SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Third Party Trademarks: Certified Financial Planner Board of Standards Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®, CFP® (with plaque design), and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

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Are you a member of the military? Whether you’re on active duty or a veteran, serving in the Reserve or National Guard, you have unique opportunities to build financial security. Taking advantage of things like military discounts and special mortgage loans can help you save money. There are also a number of other actions military members and their families can take to protect and grow their finances. Here’s what you need to know.

The Importance of Saving Money in the Military

Saving money is always a good thing when planning for your future. Members of the military — whether single, in a relationship, or married with kids — may especially benefit from making some careful money moves now. This helps ensure that your finances are in good shape after the final deployment ends.

11 Tips for Military Members to Manage Their Money

Wondering how to save money while in the military? We’ve got 11 money management tips that you may find useful if you’re a military member thinking about your financial future.

1. Creating a Budget

Having a monthly budget is a good way to track your expenses against your income. While it may be tempting to spend all of your paycheck each week during deployment, you might want to consider funneling away some money into savings or retirement to help achieve long-term financial goals and build wealth. A budget can help you do this, whether you use a journal, a spreadsheet, or an app to keep tabs on your money.

Budgeting for beginners can be overwhelming, but it’s an important step. Seeing your finances laid out in a clear budget makes it easier to determine how much you can afford to set aside from your paycheck, whether it’s to pay down debt or build your savings.

Recommended: 50/30/20 Budget Calculator

2. Opening a Savings Account

As part of your budget, it’s a good idea to open a savings account, if you don’t already have one. You can set aside money here for everything from a down payment on a house after your service to a new car to a wedding. If you intend to leave money in the account for the duration of your deployment, it’s especially wise to find a high-yield savings account that pays an above-average interest rate on your deposits.

3. Automating Your Savings

Once you have a savings account, you might benefit from automating your savings, if your financial institution offers this. When you set up automatic transfers from checking to savings, the money gets whisked away before you see it sitting there, connected to your debit card, and tempting you to spend it.

4. Avoiding Overspending

An important reason to create a budget is to avoid overspending, especially with credit cards. When you build a budget, you’ll be able to identify how much you can safely spend each month while working toward your goals. Whether actively deployed or in between deployments, it’s a good idea to rein in any unnecessary expenses and recognize common reasons for overspending.

Before making a major purchase, you might try the 30-day rule: Wait a full 30 days to see if the urge to buy the item passes. If it does, you’ve avoided an unnecessary expense.

5. Utilizing Military Resources (Like Military Discounts)

How else to save money in the military? Many retailers, restaurants, and services offer discounts to members of the military, usually if you provide military identification. While military discounts may seem small, they can add up over time. They can be especially helpful when making larger purchases, like a new car.

Some businesses extend military discounts to spouses as well. If you are deployed with a spouse back home, make sure your partner knows to ask about military discounts when shopping as well.
Wondering how to find the best military discounts? One route is to check out Military.com’s discount page and subscribe to their deals and discounts newsletter.

6. Shopping on Base

Shopping on base can be a great way to scale back your expenses as a member of the military. For example, gas is typically cheaper on base, and you can usually get great discounts on groceries by shopping at the commissary because it doesn’t charge a sales tax.

Recommended: Feeling Guilty About Spending Money?

7. Investing in Education

If you want to pursue education after your service, check out the GI Bill. This bill can help veterans pay for college, graduate school, and training and certification programs. Head to the VA website to find out how you can take advantage of this education assistance and potentially save money by being in the military.

You can also see if you qualify for military student loan forgiveness.

8. Taking Advantage of Veterans Administration (VA) Home Loans

Buying a home can be a stressful experience, from saving for a down payment to getting approved for a mortgage loan to making an attractive offer fast enough to actually get the house you want.

As a servicemember, veteran, or surviving military spouse, you likely have unique access to a Veterans Administration (VA) home loan through private lenders.

When you purchase a home using a VA home loan, you typically don’t need a down payment, you’ll get a low interest rate, you won’t have to pay for private mortgage insurance, and closing costs are limited. And this isn’t a one-time deal: You can use a VA home loan for multiple homes over the course of your life.

9. Getting a Life Insurance Policy

The U.S. Department of Veterans Affairs offers Servicemembers’ Group Life Insurance (SGLI). In fact, if you qualify as a servicemember, the VA automatically signs you up (but note – it isn’t free!). You can update the life insurance coverage as you see fit, change your beneficiaries, and extend coverage beyond your service, all by logging in with your CAC or DS Logon.

Learn more on the official SGLI page . But remember: SGLI is not your only life insurance option during and after your service. You might find better terms by shopping around for other life insurance policies.

10. Learning About Tax Breaks

The IRS offers unique tax benefits to members of the U.S. Armed Forces. These include tax breaks, tax deadline extensions, free tax help from volunteers, and more. If you’re unsure of how your service affects your tax situation, browse the free IRS resources or work with a certified tax professional.

Recommended: Tax Write-Offs for Young Adults

11. Planning for Retirement

Retirement may seem like a long way off, especially if you have just enlisted. But it’s a good idea to start planning for retirement early to maximize your income in retirement. A popular option for members of the military is the Thrift Savings Plan (TSP), a federally sponsored retirement and investment plan. This plan is akin to an employee-sponsored 401(k). Some members of the military supplement this coverage with other retirement plans.

The Takeaway

Managing your money wisely while serving in the military can set you up for a secure future. Smart moves to make during your service include setting up a budget, saving for future expenses and retirement, and taking advantage of military discounts and programs designed exclusively for servicemembers.

If you’re looking for a new banking partner, see what SoFi has to offer. When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

Is it easy to save money in the military?

Saving money while in the military can be easy if you take advantage of several helpful military programs, including VA home loans, military discounts, federally sponsored retirement plans, and even cheaper gas and groceries on base.

What expenses do military members have?

Members of the military may incur the same expenses as the average person, including housing, food, and clothing. However, in addition to a servicemember’s paycheck, the Department of Defense also offers allowances that members of the military can use for basic necessities, which can help lower daily expenses.

How much do military members earn?

Members of the military make different amounts depending on their rank and years of service. However, servicemembers’ full payment includes not only their basic pay and military benefits but also military allowances, which go toward the cost of basic necessities like food and housing. Military members, whether servicemembers or officers, can earn additional pay through the Department of Defense’s Special and Incentive Pays program.

Photo credit: iStock/YakobchukOlena

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SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.00% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

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