What is the lowest credit score you can have to buy a house? Is there such a thing and what other things should I keep track of?
(0) | asked by: Sahar | share | 55 months ago | Report
Currently msot lenders are requiring a minimum FICOof 640, which is the average score of all 3 credit reporting agencies, but you must also look out for your DTI (Debt to Income) ratio. If you are carrying an excessive amount of unsecured credit this could impact on weather you can qualify for a home loan or not. One final point on credit, if you are carrying around 70% balance of the maximum you are qualified for on your Credit Card limits, this could also impact on weather you can qualify for a home loan.
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Approval for a mortgage loan is dependent on quite a few things, credit score is only one of them. A lower credit score can be overcome by being able to show higher income or low income-to-debt ratio, for instance. It's a balancing act. The minimum score you can have is dependent on what bank you choose to work with. A reputable Realtor in your area should be able to direct you to a loan originator who can help you if you have a low credit score. I've had clients who've obtained a loan with scores in the very low 600s recently.
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