A mortgage is likely the largest financial commitment of your life — and credit score has a larger impact on your total cost than almost any other factor. A 760+ score versus a 680 score on a $400,000 30-year mortgage can mean $100,000+ in additional interest. Getting your credit right before applying is one of the highest-return financial moves you can make.
How Mortgage Lenders Use Your Score
Mortgage lenders pull your credit from all three bureaus and use your middle score — not the highest or lowest. If your three bureau scores are 720, 740, and 755, your qualifying score is 740. Joint applicants are typically qualified on the lower of the two middle scores.
Most mortgage lenders still use FICO 2, 4, and 5 (bureau-specific older models) — not the widely-advertised FICO 8 or FICO 10. The factors are similar but weighted somewhat differently. Ask your lender which models they use.
Score Thresholds and Rate Impact
| Score Range | Loan Type Access | Rate Impact |
|---|---|---|
| 760+ | All conventional, FHA, VA, jumbo | Best available rates |
| 740–759 | All standard products | 0.125–0.25% above best |
| 720–739 | Most products | 0.25–0.5% above best |
| 700–719 | Standard with some restrictions | 0.5–0.75% above best |
| 680–699 | Conventional with higher fees | 0.75–1.0% above best |
| 620–679 | FHA, VA, or subprime conventional | 1.0–1.5%+ above best |
| Below 620 | FHA minimum 580; below that, 10% down required | Limited options |
12 Months Out: The Foundation
- Pull all three credit reports and dispute every error — give errors 60–90 days to resolve before your mortgage application
- Get all accounts current — no open delinquencies at application is a hard requirement for most conventional loans
- Pay down credit card balances to below 10% utilization on each card
- Don't close old credit cards — the history and available credit both matter
- Don't open any new credit accounts — each hard inquiry can lower your score 5–10 points
- Set up autopay on everything to prevent any new late payments
6 Months Out: Fine-Tuning
- Stop using credit cards except for small monthly recurring charges (keeps them active without raising balances)
- Target 1–5% utilization on each card for maximum score impact
- Ensure all dispute resolutions are reflected on your report — follow up if not
- Check for any recent negative items that may have appeared
- If you have any collection accounts, now is the time to resolve them — settled/paid collections still matter to most mortgage underwriters even if FICO 9 ignores them
90 Days Out: Don't Break Anything
The 90 days before applying is a danger zone. Any significant change to your credit profile — good or bad — will be scrutinized. In this window:
- Do not apply for any new credit — no new cards, auto loans, or personal loans
- Do not co-sign for anyone — it adds their debt to your DTI
- Do not close any credit accounts
- Do not make any large purchases on credit (furniture, appliances)
- Do not change jobs if you can avoid it — lenders want 2+ years at the same employer or in the same field
- Do not make large unexplained deposits or withdrawals — underwriters review bank statements
Rate Shopping Without Hurting Your Score
Getting quotes from multiple mortgage lenders is smart — but it involves multiple hard inquiries. Fortunately, FICO treats all mortgage inquiries within a 14–45 day window as a single inquiry for scoring purposes. Shop aggressively within that window: get quotes from 3–5 lenders on the same day or within a few weeks.
Common Mistakes That Cost Buyers
- Opening a new credit card to get a sign-up bonus right before applying
- Paying off an installment loan right before application — losing installment history can briefly lower scores
- Making a large cash deposit without documentation (lenders must source it)
- Quitting or changing jobs during underwriting
- Financing appliances or furniture before closing — the new inquiry and debt load can trigger a full re-underwrite
- Disputing accounts after the application — active disputes can block certain mortgage programs