The Importance of Credit Scores for Home Loans

By Sabrina Biehl Published Jan 5, 2016 10:31 am Updated May 31, 2019 07:08 pm

Credit Scores are an integral factor in determining loan approval and qualified interest rate. The better your credit score the better interest rate and programs you will qualify for. On a home purchase loan the minimum acceptable middle FICO score is 580. However, some lenders/banks require 620+ for loan approval to buy a home. Minimum credit score approval varies according to each lending institution guidelines.

The good thing about credit scores is that they can be improved prior to a home purchase. Here are 13 Credit Repair Tips that can assist you if you need to improve your credit scores. Buying a home is a major financial decision and obligation. Maybe one of the biggest financial decisions and obligation that you will make in your lifetime. Although a 580 credit score will get you approved for a home loan with some lenders. Having a 620+ score will qualify you for better interest rates and other loan programs. The better your credit score the better your options will be.