Your credit score is one of the biggest factors in whether you qualify for a mortgage — and what rate you'll pay. Here's what you actually need for the most common loan types in California.
Minimum Credit Scores by Loan Type
- Conventional loans – Typically require a minimum score of 620, though the best rates usually go to borrowers above 740.
- FHA loans – Allow scores as low as 580 with a 3.5% down payment. Some lenders will go as low as 500 with a 10% down payment.
- VA loans – The VA itself doesn't set a minimum, but most lenders require at least 580-620.
- USDA loans – Generally require a 640 minimum for automatic underwriting approval.
Keep in mind: these are lender minimums, not guarantees. Meeting the minimum score doesn't automatically mean approval — income, debt-to-income ratio, and employment history all factor in too.
How Your Credit Score Affects Your Rate
Credit score doesn't just determine eligibility — it directly affects your interest rate. Lenders use pricing tiers, so even a 20-40 point difference in your score can move your rate noticeably. Over a 30-year loan, that difference can add up to tens of thousands of dollars in interest.
Generally, the pricing tiers break down around these ranges:
| Credit Score Range | What to Expect |
|---|---|
| 760+ | Best available rates |
| 700–759 | Slightly higher rate |
| 660–699 | Noticeably higher rate |
| 620–659 | Highest rate tier for conventional loans, may push you toward FHA instead |
What If Your Score Isn't There Yet?
A few things move the needle faster than people expect:
- Pay down credit card balances – Credit utilization (how much of your available credit you're using) impacts your score quickly, often within one billing cycle.
- Don't open new credit accounts before applying – New inquiries and new accounts can temporarily lower your score.
- Check your credit report for errors – Errors are more common than people assume and can be disputed to remove incorrectly reported negative items.
- Avoid closing old credit cards – This can shorten your credit history length and raise your utilization ratio.
Does a Lower Score Mean You Can't Buy a Home?
Not necessarily. FHA loans exist specifically to serve borrowers with lower scores or limited credit history. Some borrowers also benefit from working with a loan officer to identify the fastest path to improving their score before applying, rather than applying immediately at a higher rate.
Next Steps
The only way to know exactly where you stand is to have your credit reviewed against actual loan programs — general score ranges are a starting point, not a final answer.
Want to know what you qualify for?
Get pre-approved with Loaning Now and we'll review your credit against real loan programs.
Get Pre-Approved with Loaning Now →This article is for informational purposes only and does not constitute financial advice. Credit requirements vary by lender and are subject to change — contact us for current guidelines.