What is the Minimum Credit Score Required for Buying a New Home?

Bert from Orlando, Florida is looking to purchase his first home. He has some credit issues from the past. About three years ago Bert had three repossessions amounting to about two hundred and fifteen thousand dollars. He called to ask Robert Palmer, what is the minimum credit score required to qualify for a mortgage?

The minimum credit score that RP Funding works with is typically a 660 with special exceptions down to a 640. Some other lenders will go as low as 580 with a higher interest rate. I would say for Bert the first step in the home buying process is going to be building his credit score back up. The higher the credit score the easier it is going to be to find a lender that is able to work with you and the lower the interest rate you will receive. My suggestion would be to find a local credit union or small community bank and apply for secure credit. With secure credit you put funds into a CD and in turn the bank issues a credit card for the amount of the deposit. If payments are made on time and the balance is paid off each month you can see your credit score start to rise in as little as six to nine months. FHA and other lender guides are cracking down on old outstanding debt issues and it may be beneficial. Working with an attorney is a very good idea for someone like Bert and the amount of outstanding debt he has. An attorney can help dispute some of the charges on the account and help lower the amounts due to get those past debts paid off. It is possible that bankruptcy could be an option and the only requirement after bankruptcy is that there is a two year waiting period and all debt after the bankruptcy must be paid on time as agreed. So if you are looking to build your credit up get some positive credit established and work with an attorney and you will be back on track in as little as a year.