What FICO Score Is Needed to Get a Mortgage?

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A FICO score of at least 620 to 640 is the minimum for a home loan with most lenders, according to a survey by the Home Buying Institute on 2015 mortgage requirements. The FICO score necessary to obtain a mortgage depends on the particular lender, and the score requirements vary over time with economic conditions. If your FICO score is below 620, however, you still have a chance to qualify for a mortgage.

Conventional Loans

Institutions making conventional loans -- loans which aren't insured by the government -- usually follow the guidelines set by Fannie Mae and Freddie Mac, government-sponsored enterprises that purchase mortgages and bundle them for resale. Their guidelines establish a minimum FICO score of 620 for most borrowers. Exceptions are sometimes allowed for people with a sparse credit history or whose credit history is compromised.

Mortgage Insurance

Borrowers who can't come up with a minimum of 20 percent down for a conventional loan must obtain mortgage insurance. In this case, they must also meet the FICO requirements of the mortgage insurance company. Depending on the insurer and economic conditions, the minimum FICO may be as low as 620 or as high as 700 or more, according to LendingTree.

Impact on Interest Rates

You may obtain a mortgage with a score of 620, but you'll probably have to pay a higher rate of interest than those with higher scores. For example, if interest rates for borrowers with a score of 620 to 639 are 5.068 percent on a 30 year fixed mortgage, someone with with a score of 660 to 679 may qualify for an interest rate of 4.092 percent, according to the Fair Isaac Corporation, which computes credit scores. As of 2015, most lenders give their best rate if you have a score of 740 or higher, Bankrate.com reports.

Federal Housing Administration Loans

You can qualify for a Federal Housing Administration loan, if you have a FICO score of 500 or more, but you must pay at least 10 percent down if your score is below 580. Lenders make their own rules, so some require a FICO score of 660 or higher for an FHA loan, according to Lending Tree.

Getting a Mortgage With a Low Score

Credit scores of between 700 and 850 are good to excellent, according to Bankrate.com. Fair scores range from 650 to 699, while poor scores range from 600 to 649. Borrowers with fair or poor scores typically have more success obtaining FHA loans, not conventional ones. Lenders feel safer making these loans because they're insured by the government.

Nonetheless, you may also be able to qualify for a conventional mortgage with a low FICO score. Bankrate.com gives several suggestions to increase your chances:

  • Have enough in savings to pay six months of mortgage payments.
  • Show a record of on-time rent payments over a year.
  • Make a down payment of 20 percent or greater.
  • Contact several different lenders to find one that will work with you.
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