Credit Basics

Different loan products have different credit requirements.  When going through the mortgage process and trying to learn what the best option is for you, it is good to have knowledge of the different requirements so you and your mortgage specialist will be able to make the best decision together.  Here are some credit requirements for different loans.

• For all loans, borrowers with lower credit scores or limited credit depth, will be reviewed for stronger compensating factors, such as savings, or steady income in order for it to be approved.

The following information is for purchases, numbers may be different for refinances.  

FHA
580 minimum credit score - For our FHA loans, the minimum credit score a home buyer needs is 580.  To qualify at 580, the borrower will need to have good credit depth and a lower debt to income ratio.  

Conventional

620 minimum credit score - To qualify for a conventional loan the home buyer must have a minimum score of 620.  The debt to income ratios are typically a little more strict than FHA loans.

VA Loans

560 Minimum credit score - It is possible to get a VA loan with a credit score as low as 560.  With a higher credit score, home buyers may qualify with up to 60% debt to income ratio.  Home buyers with lower credit scores may qualify with a 50% debt to income ratio.

USDA

620 minimum credit score - For our USDA loans, the home buyer will need a minimum credit score of 620.  The max debt to income ratio is generally around 41%.  Typically there cannot be any collection accounts.

First Time Home Buyers

660 minimum credit score - Delaware's first time buyers program requires the home buyers to have a credit score of 660.