Having a good credit history makes it easier to be approved for a home mortgage. But there are many different types of loans, and each has its own set of requirements and minimum credit scores. So, if you’re shopping around for a home mortgage, do your homework so that you can be approved and get the best deal.
Here’s what you need to know about ideal credit scores for certain types of home mortgages:
FHA Loans: You must have a minimum score of 580 to qualify for the low down payment advantage of 3.5%. If your credit score is below 580, you may still qualify, but you will need to provide 10% down payment.
Conventional Loans: Backed by Fannie Mae and Freddie Mac, these loans require a 620 minimum score.
Jumbo Loans: This type of loan represents a greater risk for the lender, and applicants need credit score of 700 or higher.
So, if you’re shopping around for a home mortgage, first know what credit score you need for approval.
If you’re trying to build or improve your credit score, remember to pay your bills on time, and sign up for solutions like RentReporters to report on your on time rent payments to TransUnion.
For more information on RentReporters, visit here.