Credit score is very important when looking for a mortgage. It should be 720 or above. A majority of mortgages in America are secured by borrowers who score in the top 50% of the range. The average credit score for those within the 50th percentile stands at 760.
720+
If you're considering a mortgage, having a 720+ credit score can help you get a lower interest rate and better borrowing terms. In fact, a credit score in the 720+ range is considered "very good." It can help you get a mortgage with lower interest rates than a 620 credit score. You may also be eligible for high-interest credit cards that have low interest rates.
Mortgage lenders look for borrowers with long credit histories and good debt management. A credit score above 720 will allow them to assess your credit risk, and then offer the lowest possible interest rate. A credit score of 720+ is considered "excellent" by the lending industry, while a credit score of 760+ will get you the lowest mortgage rates.
760+
People with 760+ Credit Scores are likely to get the best mortgage rates. There are many ways to achieve these scores, but the most important thing is consistency. This includes paying your bills on-time and responsibly using your credit. Important is keeping track of your progress. A credit score tracker such as WalletHub is a great way to keep track of your progress.
Your FICO credit score is what mortgage lenders use to determine whether you are eligible for the best mortgage rates. The best mortgage rates were historically available to borrowers with credit scores greater than 720. To get the best mortgage rates lenders are now more demanding of borrowers with credit scores below 720.
720
You must have a minimum credit score of 720 to be eligible for the best mortgage rates. If you can improve your score, you can qualify for the lowest rates, as well as a better loan terms. Just a couple of points on your credit score will get you into a more qualified underwriting group. A small improvement in your credit score could mean thousands of dollars in savings over the life of your loan terms.
In the past the best mortgage rates were only available to borrowers who had credit scores of 720 and higher. Lenders today require a credit score between 740 and 760. However, a lower credit rating won't have a big impact on the approval of your application.
620
When looking for the best rate on a mortgage, a 620 credit score is a good starting point. Different mortgage programs will require different credit scores. For example, government-backed mortgages might have lower credit scores than conventional mortgages. A mortgage loan officer can help you determine which mortgage option is best for you.
Lenders use VantageScore scoring models or FICO scoring models to assess creditworthiness. These models factor in factors like credit card balances and debt-to-income ratios. A person with a credit score of less than 620 will pay a higher interest rate. However, a good score can still be approved for a mortgage.