Question: Does FHA require a certain minimum credit score in order to qualify for an FHA mortgage loan?
Answer: FHA doesn’t require a certain minimum credit score in order to qualify for an FHA loan, but many investors who actually lend you the money for an FHA loan do. Right now, many investors have different credit score requirements, so it can be somewhat confusing – and requires that you ask your loan officer about it before getting qualified.
For years, investors essentially had the same credit score requirements (none), but with the credit crunch here, now many investors have moved to a minimum of 620 for a middle credit score.
Some will still go down to 580.
And there are a few who don’t require a minimum credit score – so if your credit score is in bad shape, be sure to shop around because it is still possible to get approved for an FHA loan with a low credit score.
One of the big differences on whether or not you can qualify for an FHA loan with a low credit score is whether you are refinancing your home or purchasing a new one.
If you are refinancing your current FHA loan, we have an investor that doesn’t require a minimum credit score for the FHA streamline refinance.
If you are purchasing a house using an FHA loan, all of the investors that we work with currently require that you have at least a 620 middle credit score.
Based on the past 12 months of investors changing their credit score requirements, I expect these to change – but this is where they are today.
