There are two answers: the minimum to be approved, and the score at which you stop overpaying. They are far apart.
Programme minimums
- Conventional — generally 620
- FHA — 580 with 3.5% down; 500–579 with 10% down
- VA — no VA minimum, but lenders typically impose 580–620
- USDA — generally 640 for streamlined processing
- Jumbo — usually 700+, often 720+
- DSCR / non-QM — typically 660–680+
Pricing tiers — where the money is
Pricing does not improve smoothly. It steps, roughly at 620, 640, 660, 680, 700, 720, 740 and 760.
Landing at 738 rather than 740 can cost a rate adjustment worth thousands over the life of the loan. Two points of score.
This is why checking your score before applying matters. If you are within a few points of a boundary, small targeted action can move you across it.
The score lenders actually use
Not the one in your banking app. Mortgage lenders pull a tri-merge report using specific older FICO models — commonly FICO Score 2 (Experian), 4 (TransUnion) and 5 (Equifax).
These often differ from FICO 8, VantageScore or whatever your card issuer displays — sometimes by 20 points or more in either direction.
With one borrower, the middle of the three is used. With two borrowers, traditionally the lower of the two middle scores governs — meaning the weaker credit sets the pricing for both.
Moving up a tier quickly
Ranked by speed and impact:
Pay down revolving balances (30–45 days)
Utilisation is roughly 30% of your score and updates monthly. Getting each card below 30%, and ideally below 10%, is the fastest available lever. Note it is per card as well as overall — one maxed card hurts even if total utilisation is low.
Ask for a rapid rescore (3–7 days)
If you pay down balances, your lender can request a rapid rescore to update the bureaus in days rather than waiting a cycle. Must be initiated by the lender, and requires proof of payment.
Dispute genuine errors (30 days)
Roughly a fifth of credit reports contain an error. Accounts that are not yours, incorrect late payments, balances reported after payoff, duplicate collections. Bureaus must investigate within 30 days.
Become an authorised user
On a well-aged, low-utilisation account belonging to someone who trusts you. Can help thin files meaningfully.
Do not do these
- Close old cards. Shortens history and raises utilisation.
- Open new accounts. New inquiries and reduced average age, right when you need stability.
- Pay off collections without asking first. On some older scoring models, paying can reset the clock. Ask your loan officer before paying anything in collections.
Does shopping hurt your score?
Barely. Multiple mortgage inquiries within a standard shopping window — 14 to 45 days depending on the model — count as a single inquiry. The scoring models were designed to permit rate shopping.
Not shopping costs far more than the two to five points an inquiry might.
Common questions
Mortgage lenders use specific older FICO versions — typically FICO 2, 4 and 5 — which often differ from the score shown in a consumer app.
Traditionally the lower of the two middle scores. Some updated guidelines use an average — confirm which applies to your file.
General information, not advice on your specific situation. Guidelines, limits and pricing change, and vary by lender, programme and state. Nothing here is a commitment to lend or an offer of credit. For tax or legal questions, consult a qualified professional.
Sree Basireddy · Mortgage Loan Officer, NMLS 2705737 · Loan Factory, Inc., NMLS 320841 · Equal Housing Opportunity