In the 2026 housing market, your credit score remains one of the most important factors in securing a mortgage. While loan programs and interest rates continue to evolve, lenders still rely heavily on credit when determining approval, interest rates, and overall loan terms.

The short answer: most buyers need at least a 620 credit score, but a 680 or higher is typically considered “good” and can unlock better interest rates and loan options. Still, your credit score is just one part of a much bigger picture.

How Credit Scores Are Used in Mortgage Approval

When you apply for a mortgage, your credit score is one of the first things lenders review. As Brad Dexter, Branch Operations Manager at Churchill Mortgage, explains: “Your credit score is one of the first things lenders look at once you have submitted your application.” Lenders don’t rely on just one score. Instead, they pull your credit from three different credit unions: Transunion, Experian, and Equifax. They use the average score of all three to then qualify you for a loan.

If you’re applying with a spouse or co-borrower, your approval will be based on the lower profile. “If there are multiple borrowers on the loan, we use the lowest middle score of all borrowers,” Dexter explains. “When the loan is run through to price out the interest rate, the credit score determines the rate.”

In simple terms, higher credit scores usually mean lower monthly payments.

What’s Considered a Good Credit Score by Loan Type?

Different loan programs have different credit requirements, many of which are influenced by guidelines from agencies like Fannie Mae, which sets standards for conventional lending. Understanding your options can help you move forward, even if your score isn’t perfect.

Conventional Loan Credit Score Requirements

Conventional loans often offer the most flexibility and best rates for borrowers with strong credit.

• Typical minimum: 620 on fixed-rate loans
• Ideal score: 680-740+

FHA Loan Credit Score Requirements

FHA loans are popular with first-time buyers or those rebuilding credit.

• Minimum: 580 (with 3.5% down)
• Some lenders may allow lower with more down
  

VA Loan Credit Score Requirements

VA loans are designed for eligible veterans and service members and can offer competitive rates and no down payment.

• Typically, no official minimum, but many lenders look for 620+ credit score

USDA Loan Credit Score Requirements

USDA loans are available in eligible rural and suburban areas, often with zero down payment options.

• Typically, 640+ credit score is required

Why Credit Score Isn't the Only Factor

Even though your credit score carries a lot of weight, it’s not the only thing lenders look at when reviewing your application.

One of the next most important pieces is your debt-to-income ratio (DTI), which helps lenders determine how much home you can realistically afford. “Your debt-to-income ratio also plays a deciding role in the approval,” Dexter says. “We use the total monthly debt payment divided by your gross monthly income, which are report on your credit.”

The goal is to show lenders that you can comfortably manage your monthly payment alongside your existing obligations.

Down Payment and Loan Structure Also Play a Role

Beyond credit and debt, your down payment and overall loan amount can influence your approval as well. A larger down payment can reduce lender risk and may improve your chances of qualifying.

Lenders use technology to evaluate all of these factors together. “All applications are run through an automated underwriting system,” Dexter explains. “This automated system looks at your credit history, credit score, debt-to-income ratio and loan amount when determining the approval.”

However, that system isn’t always the final word. “It’s important to note that the automated system isn’t the final determination,” he adds. “There are situations where we can still get you approved even if the automated system says no.”

Can You Buy a Home with a Lower Credit Score?

The good news is that buyers don’t need perfect credit to get approved. In many cases, there are ways to strengthen a loan application, even if your score is below the ideal range.

“The important thing to remember is that no matter what your situation may be, there are always ways to improve,” Dexter says.

How to Qualify for a Mortgage (Expert Lender Tips)

According to Brad Dexter, here are ways to improve your chances of getting approved:

• Lower your debt-to-income ratio (DTI)
  Pay off existing debts to reduce how much of your income is going toward monthly obligations.
  “I will first look to see if there is anything we can pay off to reduce the ratio.”
  
  
• Increase your income
  A higher income can help balance your debt and strengthen your application.
  
  
• Add a co-signer or co-borrower
  Bringing in another borrower can boost your qualifying income.
  “We can also look at adding a co-signer on the loan to increase the qualifying income.”
  
  
• Boost your down payment
  A larger down payment lowers lender risk and can improve approval odds.
  “I will often suggest that the borrower get a gift from family to increase the down payment amount.”
  
  
• Improve your credit score strategically
  Use lender tools to identify quick ways to raise your score.
  “I will run it through my credit simulation system to give suggestions to help improve the score.” 

Understanding what qualifies as a good credit score matters, but it should not stop you from exploring your options. Lenders look at more than just one number.

Even if your credit score is still improving, you may have more paths to homeownership than you think, especially with the right loan officer guiding you.

Frequently Asked Questions

Check our FAQs for responses to our most popular questions about credit scores and buying a home in 2026.