first time home buyer loan credit score essentials and popular choices

Why your score matters

Your credit score guides pricing, approvals, and even required cash to close. Lenders use it to gauge risk; a higher number can unlock lower rates, smaller mortgage insurance, and smoother underwriting.

Common programs compared

Minimum scores and tradeoffs

Different loans reward different profiles. Below is a quick comparison to help you weigh access against cost.

• FHA: Often 580+ for 3.5% down; forgiving on past credit, but mortgage insurance lasts longer.
• Conventional: Typically 620+; pricing improves at 680, 700, 740; cancellable PMI with equity.
• VA: No set agency minimum; many lenders look for ~620; strong terms for eligible veterans.
• USDA: Generally 640+ and area/income limits; competitive rates, no down payment.

How to strengthen your file

Pay down revolving balances to below 30% utilization, dispute inaccuracies, and avoid new credit before preapproval. A small score bump can shift you into a better pricing tier.

Next steps

Get a soft-pull precheck, compare at least three lenders, and ask for a loan estimate showing rate, points, and mortgage insurance at your current score and at a target tier. Timing your application after score updates can save thousands.