Is 700 A Good Enough Credit Score To Buy A House? | Bankrate (2024)

Key takeaways

  • Credit scores typically span from 300 to 850 — the higher your score, the better.
  • Different mortgages have different minimum credit score requirements. Generally, higher scores will qualify for lower interest rates.
  • Paying your bills punctually and paying down outstanding debts can help raise your credit score.

When you’re financing the purchase of a home, it’s important to understand what mortgage lenders look for when evaluating potential borrowers. One factor they strongly value is your credit score, a measure of how creditworthy you are: The higher your score, the more attractive you will appear to lenders.

FICO and VantageScore, two of the most prominent players, score in a range from a low of 300 to a high of 850. Ideally, your credit score is closer to that high end. But what if your credit score is a bit lower than ideal? For example, is 700 a good credit score to buy a house? Here we’ll break down recommended scores for different types of mortgage loans, and whether you can buy a house with a 700 credit score.

What credit score do I need to buy a house?

“There are four major factors mortgage companies typically use to make decisions when lending money: credit score, income, assets and payment history,” says Ralph DiBugnara, a senior vice president at Cardinal Financial and founder of Home Qualified. “A good credit score is the only one that will directly impact the interest rate you will receive as a borrower, so it has the largest impact long-term.”

Higher scores signify better credit, but what is considered a “good” score? Most mortgage lenders will likely use FICO credit scores, and though FICO and VantageScore scales differ slightly, a score of 700 is considered “good” by both companies. Here’s how both break down the range of 300 to 850:

Sources: FICO and VantageScore
Very good740–799n/a
Very poorn/a300–499

A 700 credit score might not be the very top of the scale, but it shouldn’t disqualify you from any of the major home financing options available. So yes, 700 ought to be a good enough credit score to buy a house. In fact, says DiBugnara, “a credit score of 680 or above will likely give borrowers access to 95 percent of financing options available.”

What types of loans can I get with a 700 credit score?

A FICO score of 700 is above the minimum requirement for most types of home loans — even jumbo loans for more expensive homes.

Conventional loan

Conventional conforming loans usually have a minimum credit score requirement of 620 for fixed-rate mortgages and 640 for adjustable-rate mortgages. “However, to secure more preferred interest rates and terms on a conventional loan, a credit score of 700 or above is advisable,” says Rick Gruebele, owner/broker at Visions First Realty in northern Wisconsin.

FHA loan

A mortgage guaranteed by the Federal Housing Administration requires lower minimum credit scores than many conventional loans, which makes them particularly popular with first-time purchasers (although you don’t have to be a first-time buyer to use an FHA loan). A credit score of only 500 is needed so long as you put down a down payment of 10 percent or higher; with a score of 580 or higher, you need only put down at least 3.5 percent.

VA loan

Active-duty military service members, veterans and surviving spouses may be eligible for a VA home loan. “The VA does not set a minimum credit score requirement,” Gruebele says. “But lenders may have their own standards. A credit score of 620 or higher is often necessary to secure favorable VA loan terms.”

USDA loan

A loan backed by the U.S. Department of Agriculture caters to purchasers buying in eligible rural regions, and a credit score of 640 or higher is usually required.

Jumbo loan

Jumbo loans provide funds for larger-than-normal borrowing needs that exceed conforming loan limits. “Jumbo loans generally require a minimum credit score of 700 or higher,” says Kevin Martini, a certified mortgage advisor with Martini Mortgage Group at Gold Star Mortgage Financial Group.

How does a 700 credit score impact how much house I can afford?

Your creditworthiness has a direct affect on how much you can afford to spend on a home. When lenders see you as low-risk they are more willing to offer you a low interest rate, which in turn means lower monthly payments over the life of the loan.

If you’re wondering whether you can buy a house with your “good” credit score of 700, you likely can. But your total loan costs with a 700 score as opposed to, say, 760 are significantly different.

Let’s use a 30-year fixed-rate mortgage loan for $300,000 as an example. According to FICO’s Loan Savings Calculator, a 700 credit score could secure an interest rate of 6.796 percent (as of mid-August 2023). In this scenario, your monthly payment would be $1,955. But with 760 you would qualify for the best interest rate available, 6.574 percent, which results in a monthly payment of $1,911. That extra $44 per month may not sound like much of a savings, but over 30 years, it equates to an extra $15,840 paid in total interest.

The same is true in the opposite direction of the scale: Your 700 score and $1,955 payment puts you in much better stead than a score of, say, 620, the minimum needed for a conventional loan. That number would bring the monthly payments way up to $2,235.

How can I improve my credit score?

Obviously, it’s well worth taking the time to improve your credit score before applying for a home loan. Here are several strategies that can help raise your score:

  • Pay your bills on time: “The most impactful strategy for improving your credit score is consistently making timely payments,” says Martini. “This includes not just credit card bills but also other bills like rent, utilities and even cell phone bills.”
  • Pay down your outstanding debt: “A high level of debt can negatively impact your credit score,” Martini says. Adds Gruebele: “Aim to lower your credit card balances to below 30 percent of the credit limit on each card. This will improve your credit utilization ratio, positively affecting your score.”
  • Avoid opening new credit accounts: Applying for credit frequently can cause your score to creep downward. “Every time you apply for credit, a hard inquiry is made on your credit report,” says Martini. “This can negatively impact your credit score, mainly if you apply multiple times within a short period.”
  • Avoid closing existing accounts too: Keep old credit accounts open, even if you no longer use them. The length of your credit history influences your score, Gruebele says, so old accounts that are all paid up can have a positive effect.
  • Review your credit: Check your credit report and address any errors or discrepancies you spot. “Having a general understanding of what’s on your credit reports and making sure there are no inaccuracies is a great way to improve your score,” DiBugnara says. “Sometimes old trade lines, mistaken missed payments or collections can drag the score down.”

Aim to implement the tactics above at least six months before applying for a mortgage loan, to allow enough time for your actions to reflect in your credit score.

Next steps

If your credit score isn’t ideal, it might be smart to wait a bit before buying a house, to give yourself time to build it up — and set yourself up for lower payments. When you’re ready to start house-hunting, partner with a local real estate agent early in the game. An agent who’s knowledgeable about your specific area can guide your homebuying journey and help you find a home that meets both your needs and your budget.


  • Yes. Assuming the rest of your finances are solid, a credit score of 700 should qualify you for all major loan programs: conventional, FHA, VA and USDA loans all have lower minimum requirements, and even jumbo loans require a 700 score at minimum.

  • The right time to purchase a home is when you are financially ready, says certified mortgage advisor Kevin Martini. If you have good job security with consistent earnings and can demonstrate creditworthiness — as reflected by your credit score — you should be well-positioned to qualify for financing and purchase now. However, mortgage rates and home prices are high right now, so if your job isn’t stable, you don’t have enough savings for a down payment or your credit score is low, it’s probably smarter to wait.

  • As a general rule of thumb, most financial experts suggest that your total monthly housing costs, including mortgage payment, property taxes and insurance, should not exceed 28 to 30 percent of your gross monthly income. For example, if you make $100,000 a year, that’s $8,333 per month. Twenty-eight percent of that is $2,333, so on that salary you can afford a home purchase that keeps your total monthly payments below $2,333.

Is 700 A Good Enough Credit Score To Buy A House? | Bankrate (2024)


Is 700 A Good Enough Credit Score To Buy A House? | Bankrate? ›

So yes, 700 ought to be a good enough credit score to buy a house. In fact, says DiBugnara, “a credit score of 680 or above will likely give borrowers access to 95 percent of financing options available.”

Can I get a house with a 700 credit score? ›

So yes, 700 ought to be a good enough credit score to buy a house. In fact, says DiBugnara, “a credit score of 680 or above will likely give borrowers access to 95 percent of financing options available.”

How much will I get approved for with a 700 credit score? ›

You can borrow from $1,000 to $100,000 or more with a 700 credit score. The exact amount of money you will get depends on other factors besides your credit score, such as your income, your employment status, the type of loan you get, and even the lender.

What credit score is needed to buy a $300K house? ›

What credit score is needed to buy a $300K house? The required credit score to buy a $300K house typically ranges from 580 to 720 or higher, depending on the type of loan. For an FHA loan, the minimum credit score is usually around 580.

What is a good enough credit score to buy a house? ›

You'll typically need a credit score of 620 to finance a home purchase. However, some lenders may offer mortgage loans to borrowers with scores as low as 500. Whether you qualify for a specific loan type also depends on personal factors like your debt-to-income ratio (DTI), loan-to-value ratio (LTV) and income.

Can I get an FHA loan with a 700 credit score? ›

FHA loan. FHA loans are generally intended for home buyers with lower credit, starting at 580. So they're likely not best for someone with a 700 credit score. With a 700 score, you're likely to qualify for a conventional loan with cheaper mortgage insurance and an even smaller down payment.

How to go from 700 to 750 credit score? ›

Here are some of the best ways.
  1. Pay on Time, Every Time. ...
  2. Reduce Your Credit Card Balances. ...
  3. Avoid Taking Out New Debt Frequently. ...
  4. Be Mindful of the Types of Credit You Use. ...
  5. Dispute Inaccurate Credit Report Information. ...
  6. Don't Close Old Credit Cards.
Feb 7, 2021

Can I afford a 300k house on a 40k salary? ›

To purchase a $300K house, you may need to make between $50,000 and $74,500 a year. This is a rule of thumb, and the specific annual salary will vary depending on your credit score, debt-to-income ratio, type of home loan, loan term, and mortgage rate. Homeownership costs like HOA fees can also impact affordability.

How much income do I need for a $400,000 mortgage? ›

Most buyers nowadays have housing payments in excess of 40% of their gross income. By today's standards, even in a 6% to 7% interest rate environment, you can qualify for a $400,000 home with as little as $70,000 of income with a 20% down payment – depending on your property tax and insurance rates.

Can I afford a 300k house on a 60k salary? ›

An individual earning $60,000 a year may buy a home worth ranging from $180,000 to over $300,000. That's because your wage isn't the only factor that affects your house purchase budget. Your credit score, existing debts, mortgage rates, and a variety of other considerations must all be taken into account.

How can I raise my credit score 100 points in 30 days? ›

Steps you can take to raise your credit score quickly include:
  1. Lower your credit utilization rate.
  2. Ask for late payment forgiveness.
  3. Dispute inaccurate information on your credit reports.
  4. Add utility and phone payments to your credit report.
  5. Check and understand your credit score.
  6. The bottom line about building credit fast.

What is the average person's credit score? ›

The average FICO credit score in the US is 717, according to the latest FICO data. The average VantageScore is 701 as of January 2024. Credit scores, which are like a grade for your borrowing history, fall in the range of 300 to 850.

How can I raise my credit score 20 points fast? ›

  1. Pay credit card balances strategically.
  2. Ask for higher credit limits.
  3. Become an authorized user.
  4. Pay bills on time.
  5. Dispute credit report errors.
  6. Deal with collections accounts.
  7. Use a secured credit card.
  8. Get credit for rent and utility payments.
Mar 26, 2024

What credit score do you need to buy a $600000 house? ›

What Credit Score Is Needed To Buy A House?
Type Of LoanMinimum FICO® Score
Conventional loan620 (Federal Housing Financing Agency requirement)
Federal Housing Administration (FHA) loan with a 3.5% down payment580 (FHA requirement)
FHA loan with a 10% down payment500 (FHA requirement)
3 more rows
Feb 23, 2024

What credit score do I need to buy a 200 000 house? ›

You typically need at least a 620 credit score to qualify for a conventional loan. Though, the higher your score, the better your chances of getting approved for the best rates.

What is the minimum credit score for a mortgage? ›

Credit score and mortgages

The minimum credit score needed for most mortgages is typically around 620. However, government-backed mortgages like Federal Housing Administration (FHA) loans typically have lower credit requirements than conventional fixed-rate loans and adjustable-rate mortgages (ARMs).

What kind of interest rate would I get with a 700 credit score? ›

A Higher FICO Score Saves You Money
700-7596.606 %
680-6996.783 %
660-6796.997 %
640-6597.427 %
620-6397.973 %
3 more rows

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