The Truth About Credit Scores & Mortgage Approval
- By Jim Blackburn
- on
- purchase, real estate investing, vision board, wealth plan
You’ve probably heard it a hundred times:
“You need a great credit score to get a mortgage.”
But what exactly is a “great” score?
How much does it really affect your approval — or your interest rate?
And what if your score isn’t perfect?
Let’s clear up the confusion and give you the truth about how credit scores work in mortgage lending.
What Lenders Actually Look For
Mortgage lenders use your FICO credit score to help assess your likelihood of repaying a loan.
But they don’t look at just one score — they usually look at three (from Equifax, Experian, and TransUnion) and take the middle one.
Here’s a general breakdown:
Score Range | Impact on Approval |
760+ | Best rates & terms |
700–759 | Very good |
660–699 | Still qualify, slightly higher rates |
620–659 | May need compensating factors |
Below 620 | Possible with FHA or subprime lenders |
The truth? You don’t need “excellent” credit to get approved — but better credit usually means better terms.
Understand your approval odds and explore programs for different credit levels using our FHA Purchase Loan calculator, which accepts scores as low as 580, or our Conventional Purchase Loan calculator for higher scores.
How Credit Affects Your Interest Rate
Lenders price risk into your interest rate. That means:
- A higher score = lower interest rate
- Lower score = higher rate or more conditions
But even if your score is lower, that doesn’t mean you’re stuck.
A skilled mortgage advisor can help you:
- Use non-traditional loan programs (FHA, VA, bank statement)
- Add compensating factors like low debt or strong income
Strategically boost your score in 30–60 days
See how different rates impact your total cost with our Compare 2 Rates calculator to understand the real financial difference between score ranges over the life of your loan.
What NOT to Do Before Applying
Even people with good scores can accidentally hurt their approval chances. Avoid these common mistakes before or during the mortgage process:
- Don’t open new credit cards
- Don’t buy a car or take on new debt
- Don’t make large transfers or deposits without documentation
- Don’t close old accounts or make big balance shifts
Always talk to your mortgage advisor before making any major financial moves.
Get started on the right foot with our same-day approval process and expert guidance on protecting your credit during the mortgage journey.
What If My Score Isn’t Great?
That’s what we’re here for.
We’ve helped people with 580 credit scores become homeowners, and we’ve helped 800-score clients save six figures in interest.
It’s not just about the number. It’s about the strategy.
Take our Discovery Quiz to see which loan programs match your credit profile and financial situation.
Bottom Line: Your Score Is Just One Part of the Puzzle
We look at the whole picture — income, assets, debt, goals — and we build a mortgage plan that works for you.
Whether you’re buying your first home or building your tenth, we’ll help you use your credit to your advantage.
Explore all your financing options at our buy a house journey page to find the program that works for your credit and goals.
Want to Know What You Qualify For—Regardless of Your Credit Score?
Your credit score is important, but it’s not everything. Here’s how to move forward:
🏡 See FHA options with the FHA Purchase Loan calculator if your score is between 580-680
💰 Explore conventional financing with our Conventional Purchase Loan calculator for scores above 680
📊 Compare total costs at different rates with our Compare 2 Rates calculator
⚡ Get same-day approval to see exactly what you qualify for based on your complete financial picture
Ready to Take Your First Step?
Skip the guesswork. Take our quick Discovery Quiz to uncover your top financial priorities, so we can guide you toward the wealth-building strategies that fit your life.
- Takes just 5 minutes
- Tailored results based on your answers
- No credit check required
Need a Pre-Approval Letter—Fast?
Buying a home soon? Complete our short form and we’ll connect you with the best loan options for your target property and financial situation—fast.
- Only 2 minutes to complete
- Quick turnaround on pre-approval
- No credit score impact
Got a Few Questions First?
Let’s talk it through. Book a call and one of our friendly advisors will be in touch to guide you personally.
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