Minimum Credit Score Needed for a Mortgage Loan

Reader Question: Can you tell me the minimum credit score needed to get a home mortgage loan in the current economy? I know a lot has changed over the last few years, but I can't seem to find a straight answer on this one. Thanks. -Ann

Hi Ann. The reason you can't get a straight answer to this question is because there isn't one. I can give you some average credit scores needed to qualify for a mortgage, but you should not take them as gospel.

In 2009, you would probably need a minimum score of 660 (give or take a few points) to be approved for a home mortgage loan. You would need an even higher score to qualify for the best rates -- we'll take more about that in a moment.

There are many variables involved with the mortgage qualification process, and the minimum credit score needed is just one of those variables. For example, a person with a FICO score of 720, but mountains of debt, might get denied for a certain loan. While a person with a score of 710, and very little debt, could very well get approved for that same loan.

Lenders will look at many factors when considering your application -- credit score, income, amount of debt, the affordability of the loan and more. This is why it's so hard to say what minimum score is needed to get a home mortgage loan.

Also, keep in mind that there's a difference between (A) qualifying for a home loan and (B) getting the best rates on that loan. You might be able to get a mortgage with a minimum score of 680 or so, but you won't get the best rates at that level -- you'd need a score of about 750 or higher to get the lowest interest rates.

I'd like to reiterate that my comments are by no means set in stone. The only way to know if you qualify for a home loan is to apply for one. Only a lender can tell you whether or not you meet their standards, or what their minimum credit score requirements are. Anyone else who talks about this subject (including myself) is just offering an educated guess -- so don't take it as gospel.

Apply online for a mortgage and you'll quickly find out if you meet a lender's minimum FICO score standards. This is really the only way to know where you stand, with any certainty at least.

Related Article:

Credit Score Need to Buy a Home in 2009
This article is a great place for you to go next. It's actually a combination article and video, and it explains how the FICO scoring system applies to home loan qualification. It also discusses the minimum score needed to (A) qualify for a mortgage and (B) get the best rates on a loan.