What’s the Right Credit Score to Buy a Home?

If you’re thinking about buying a home, one of the first things lenders will look at is your credit score — and for good reason. Your score tells them how you handle debt, how trustworthy you are as a borrower, and how much interest you’ll pay over time.

So, what’s the right credit score to buy a home in 2025?

Let’s break it down — by loan type, by score range, and what you can do if you’re not quite there yet.

Minimum Credit Scores by Loan Type

Here’s what most lenders look for as of 2025:

Loan Type	Minimum Score	Notes
Conventional Loan	620+	Lower scores may qualify but with higher rates or PMI
FHA Loan	580+	3.5% down if 580+; 10% down if 500–579
VA Loan	580–620	For eligible veterans; no down payment required
USDA Loan	640+	Rural areas only; zero down payment
Jumbo Loan	700–740+	For high-value homes; strict underwriting

Ideal Credit Score to Aim For

While 620 is often the minimum, most experts recommend aiming for at least 680–700. Here's why:

• You'll qualify for better interest rates

• You’ll have access to more loan programs

• You'll likely pay less in PMI or avoid it altogether

• Your monthly payment will be lower over the life of the loan

A higher score = thousands in long-term savings.

What If Your Score Is Lower Than 620?

You're not out of options, but it may take a little extra work:

• Consider an FHA loan with a larger down payment (10%)

• Work on paying down debt and boosting your score over 3–6 months

• Look for credit repair support if there are errors or collections

• Avoid new credit inquiries while preparing to buy

Pro Tip: You can get a free credit report once a year at AnnualCreditReport.com

Why Your Score Affects Your Monthly Payment

Let’s say you’re borrowing ₱5,000,000 (or $100,000):

• With a 760+ score, your interest rate might be 6.25%

• With a 620 score, you could pay closer to 7.5%

That’s a ₱3,000–₱5,000 per month difference in some cases—just based on your credit.

Tips to Improve Your Credit Before Applying

1. Pay bills on time — Payment history = 35% of your score

2. Keep credit utilization under 30%

3. Don’t close old credit accounts

4. Avoid new loans or credit cards

5. Dispute errors on your report

Final Thought

While it’s possible to buy a home with a credit score in the 580–620 range, the sweet spot for better terms is 680+ — and the magic number for best rates is often 740+.

If your score isn’t quite there yet, don’t worry. A few months of focused effort can make a huge difference.

Need help reviewing your score or finding a lender who works with your situation? Let’s chat — I’ll guide you through the next steps.