How Your Credit Score Affects Your Mortgage Rate and Approval

No single factor has a bigger impact on your mortgage rate than your credit score. A difference of 40 to 60 points can translate to tens of thousands of dollars in additional interest over the life of a 30-year loan.

How Mortgage Credit Scoring Works

Lenders use a specific FICO version for mortgage lending — not the score you see in Credit Karma or on your credit card statement. Lenders pull all three bureaus — Experian, Equifax, and TransUnion — and use the middle of the three scores for qualification. For co-borrowers, the lower of the two middle scores is used.

Minimum Credit Scores by Loan Type

Conventional: 620 minimum, 700+ for competitive pricing. FHA: 580 for 3.5% down, but lender overlays often require 620. VA: No official minimum, most lenders require 620+. DSCR: Typically 620 to 660 depending on program. Jumbo: Usually 700 to 720 minimum.

How Score Affects Pricing

Loan-level price adjustments create tiered pricing where better scores receive better rates. The difference between a 680 and a 760 score on a conventional loan can be 0.5 to 1.0% in rate — roughly $120 to $240 per month on a $400,000 loan.

How to Improve Your Score Quickly

Pay credit card balances down to below 30% of the credit limit — ideally below 10%. Do not close old accounts. Do not open new accounts in the months before applying. Dispute any errors on all three credit reports. Pay all bills on time without exception.

Rapid Rescoring

If you can take action — like paying down a balance — ask your lender about rapid rescoring. Documented changes are submitted directly to the bureaus and updated within 3 to 5 business days, potentially lifting your score before your application is fully underwritten.

At East Coast Mortgage, we review your credit profile as part of every pre-qualification and advise on the fastest path to your target score. Book a call to get started.