Understanding Credit Scores for Homebuyers | What You Need to Know

Want to buy a home but wondering about your credit score? Let's talk about what credit score you need to buy a house, so that you can become a homeowner!

Your credit score is very important when buying a house. Typically, you need a credit score of 620 to qualify for a conventional mortgage. However, FHA loans will consider borrowers with a credit score of 580 or above, as long as they can put at least 10% down. This allows individuals with a slightly lower credit score to still have access to homeownership, albeit with a higher down payment than the usual 3.5% required by FHA.

Credit scores can be intimidating, so if you have questions about your score or how to raise it, we suggest talking to a local lender. They can guide you through the necessary steps to improve your score and help you create a plan for reducing debt, which in turn will boost your score and make it easier to secure a favorable loan. Additionally, a local lender will assess your financial situation and provide insights on what you can realistically afford in terms of monthly mortgage payments, enabling you to make informed decisions as you navigate the homebuying process.

If you have more questions about homeownership, reach out to one of our agents at Castle Rock Realty. We're here to assist you every step of the way.