Did you know 7 out of 10 homebuyers don’t know the minimum credit score required by lenders? Many also don’t realize these requirements vary by loan type. Generally, minimum credit scores range from 600 to 700, meaning perfect credit isn’t necessary to buy a home.

Why Credit Scores Matter

Your credit score impacts loan approval, interest rates, and terms:

• Loan Approval: Lenders use your score to assess risk.
• Interest Rates: Higher scores can get you better rates.
• Loan Terms: Your score may affect the amount you’re approved for and loan flexibility.

Steps to Prepare

If you’re uncertain about your credit, start by:

1. Checking Your Credit Report: Review your credit report for free at annualcreditreport.com (or better yet, with one of our lenders for better advice) to spot any errors.
2. Consulting a Lender: A lender can explain loan options suited to your score and offer tips for improvement.
3. Exploring Loan Types: Different loans, like FHA, VA, conventional and down payment assistance, have varied credit requirements.

The Takeaway

Your credit score is important, but not the only factor in buying a home. Don’t let misconceptions about needing perfect credit hold you back. Connect with us to help get one step closer to homeownership.