Is 800 a good enough credit score to buy a house? - Bankrate (2024)

Is 800 a good enough credit score to buy a house? - Bankrate (1)

Ruth Peterkin/Getty Images

Your credit score carries a lot of weight when you’re applying for a mortgage. Not only does it help lenders determine whether or not they’ll offer you a loan, but it also influences the interest rate and terms of that loan.

With a score of 800, you’re in great shape credit-wise — in the highest possible credit score range. But how does it impact your homebuying journey? Is 800 a good credit score to buy a house? The short answer is yes, it is, and it can help you land the most competitive mortgage rates as well. Here’s what else to know about buying a house with an 800 credit score.

What credit score do you need to buy a house?

When lenders review your mortgage application, your credit score is one of the main factors they use to make a decision. Broadly speaking, the higher your score is, the more likely you are to get approved for a loan with a low interest rate and favorable terms.

You don’t need a score as high as 800 to buy a home (though it certainly helps). Some types of loans have no minimum credit score requirements, and FHA loans can be had with a score as low as 500 for qualified borrowers. But most homebuyers these days have scores much higher than that: According to data from the Federal Reserve Bank of New York, the median credit score for new mortgages in the fourth quarter of 2023 was 770.

What types of loans can I get with an 800 credit score?

Many types of mortgages do have minimum credit score requirements, but a score of 800 will put you above the minimum for just about everything. According to both the FICO and VantageScore models, an 800 lands you in the top tier in the range, meaning that you have “exceptional” or “excellent” credit. Here are the requirements for some of the most common loan types:

  • Conventional loans: A credit score of 800 is well above the minimum needed to qualify for a conforming conventional loan, which is typically 620. In fact, with an 800, you ought to qualify for some of the best interest rates and terms available.
  • FHA loans: First-time homebuyers and those looking for a mortgage with a low down payment often look to a loan from the Federal Housing Administration. The minimum credit score for these, if you qualify, is 500 with a 10 percent down payment and 580 with a 3.5 percent down payment.
  • VA loans: To be eligible for a home loan from the U.S. Department of Veterans Affairs, you must be an active-duty military service member, veteran or surviving spouse. The VA doesn’t set credit score minimums, but lenders generally look for a score of 620 or higher.
  • USDA loans: The U.S. Department of Agriculture’s loans are only available to low- and moderate-income buyers who purchase a home in a USDA-approved rural area. Typically, the credit score minimum is 640.
  • Jumbo loans: Loans that exceed the conforming loan limits in your area have the highest credit score requirements — but even for these the minimum is usually a score of 700, so your 800 score is well above that.

How does having an 800 credit score impact how much house I can afford?

Your credit score directly influences how much house you can afford. When you have a higher score, you’ve proven that you are responsible with credit. As a result, lenders are likely to see you as a low-risk borrower and offer you lower mortgage rates. Lower rates mean lower monthly mortgage payments, which in turn means significant savings over the life of a loan.

Here’s an example: Let’s say you’re buying a $400,000 house with a 20 percent down payment, and your high credit score qualifies you for a 30-year fixed mortgage at an interest rate of 6.2 percent. According to Bankrate’s mortgage calculator, that would result in monthly principal and interest payments of $1,959. The exact same loan at a rate of 7.2 percent would bring that amount to $2,172 — that’s $213 more a month, $2,556 more a year, and a difference of more than $76,000 over 30 years.

Do I need to improve my credit score?

With an 800 credit score, you’re already in the highest possible range, meaning that you should get the best rates lenders are able to offer. Still, there are some ways to boost your score even higher and strengthen your mortgage application.

For one, you can focus on improving your debt-to-income ratio, or DTI. This metric compares your monthly debt obligations (including your housing payment, car loan, student loans and credit card payments) against your monthly income. Lenders use it to assess your ability to manage and repay debt, and the lower it is, the better. Reducing your DTI can be done by either paying down your debt or increasing your income.

If you aren’t in a rush to buy right away, you can also take some time to save for a bigger down payment. When you put down more money upfront, you need to borrow less, which reduces your monthly payments and lifetime interest. You might even get a better interest rate. Plus, if you’re able to put 20 percent down you won’t have to pay for private mortgage insurance, saving you even more money.

Next steps

With a credit score of 800, you’re in good shape to start shopping for a home. A local real estate agent who knows your local market well can guide you through the journey to find a home you love at a price you can afford. Interview a few candidates to find one you feel comfortable with, and ask questions to make sure your agent understands your budget, timeline and must-haves.

FAQs

  • Yes. An 800 credit score is considered “exceptional” by FICO and is in the highest tier of scores. As long as you meet the lenders’ other requirements, your score is high enough to qualify for just about any mortgage loan.

  • With today’s high interest rates and housing prices, it’s easy to understand why some folks are waiting to purchase a home. However, trying to time the market is risky. If you have a stable job, good credit and enough money for a sizable down payment and closing costs, it might make sense to buy now and start building equity. If rates decrease in the future, you can always refinance.

  • To get a general idea of how much you can afford to spend on a home, look to the 28/36 rule. This common rule of thumb dictates that you shouldn’t put more than 28 percent of your gross monthly income toward housing, or more than 36 percent on all of your debt (including housing).

Is 800 a good enough credit score to buy a house? - Bankrate (2024)

FAQs

Is 800 a good enough credit score to buy a house? - Bankrate? ›

Yes. An 800 credit score is considered “exceptional” by FICO and is in the highest tier of scores. As long as you meet the lenders' other requirements, your score is high enough to qualify for just about any mortgage loan.

Can I buy a house with an 800 credit score? ›

Your credit score has less bearing on your ability to get a mortgage than you might think. The minimum FICO score for a conventional loan is 620. The best rate comes with a score of 740 or higher. There is no particular advantage to having a score of 800, although it is, of course, laudable.

How big of a loan can I get with an 800 credit score? ›

If you qualify for a loan and can afford it, there isn't necessarily a limit to how much you can borrow with an 800 credit score. You may be able to take out: A personal loan for $100,000. A car loan for $250,000.

What kind of mortgage interest rate can I get with a 800 credit score? ›

What's the Big Deal About Credit Scores?
FICO ScoreAPR %Monthly Payment
760 – 8503.408$888
700 – 7593.63$913
680 – 6993.807$933
660 – 6794.021$957
2 more rows

What credit score is needed to buy a $300K house? ›

The required credit score to buy a $300K house typically ranges from 580 to 720 or higher, depending on the type of loan. For an FHA loan, the minimum credit score is usually around 580.

How rare is an 800 credit score? ›

How rare is an 800 credit score? An 800 credit score is not as rare as most people think, considering that roughly 23% of adults have a credit score in the 800-850 range, according to data from FICO. A score in this range allows consumers to access the best credit card offers and loans with the most favorable terms.

Is there a difference between a 750 and 800 credit score? ›

A 750 credit score is Very Good, but it can be even better. If you can elevate your score into the Exceptional range (800-850), you could become eligible for the very best lending terms, including the lowest interest rates and fees, and the most enticing credit-card rewards programs.

Is a 900 credit score possible? ›

Highlights: While older models of credit scores used to go as high as 900, you can no longer achieve a 900 credit score. The highest score you can receive today is 850. Anything above 800 is considered an excellent credit score.

Can I get 0 APR with 800 credit score? ›

The exact credit score you might need to qualify for a 0% APR loan varies depending on your situation. Many lenders require a minimum score of at least 700. Others require excellent credit scores, such as 720, 750, or even 800.

What to expect with an 800 credit score? ›

Your 800 FICO® Score falls in the range of scores, from 800 to 850, that is categorized as Exceptional. Your FICO® Score is well above the average credit score, and you are likely to receive easy approvals when applying for new credit. 21% of all consumers have FICO® Scores in the Exceptional range.

Can you get a FHA loan with a 800 credit score? ›

You don't need a score as high as 800 to buy a home (though it certainly helps). Some types of loans have no minimum credit score requirements, and FHA loans can be had with a score as low as 500 for qualified borrowers.

What credit score do I need to buy a house with no money down? ›

A USDA loan is insured by the U.S. Department of Agriculture and is meant for low- to moderate-income home buyers. The USDA doesn't require a down payment and doesn't set a minimum credit score requirement, though most lenders will want borrowers to have at least a 640.

Is there a difference between 800 and 850 credit score? ›

Just getting your credit score over 800, officially an excellent credit score, gives you the same advantages and benefits that come with a perfect credit score. Experian reports that 21 percent of all consumers have achieved excellent credit, compared to just 1.6 percent with a perfect 850 credit score.

How much do you need to make a year to afford a $300 K house? ›

How much do I need to make to buy a $300K house? To purchase a $300K house, you may need to make between $50,000 and $74,500 a year. This is a rule of thumb, and the specific salary will vary depending on your credit score, debt-to-income ratio, type of home loan, loan term, and mortgage rate.

How much is a 20% down payment on a $350 000 house? ›

The median downpayment on a home is 13%, but if a buyer wants to avoid fees, including private mortgage insurance, they may have to put at least 20% down. If a buyer puts 20% down and takes out a $350K mortgage, they're likely putting down around $87,500.

What is the 20% down payment on a $300 000 house? ›

A 20% down payment on a $300,000 mortgage is $60,000. The $60,000 down payment is what most lenders look for especially commercial lenders, because it helps mitigate the risk of default.

What is the lowest credit score to buy a house? ›

You'll typically need a credit score of 620 to finance a home purchase. However, some lenders may offer mortgage loans to borrowers with scores as low as 500. Whether you qualify for a specific loan type also depends on personal factors like your debt-to-income ratio (DTI), loan-to-value ratio (LTV) and income.

How powerful is an 800 credit score? ›

Your 800 FICO® Score falls in the range of scores, from 800 to 850, that is categorized as Exceptional. Your FICO® Score is well above the average credit score, and you are likely to receive easy approvals when applying for new credit. 21% of all consumers have FICO® Scores in the Exceptional range.

What is the minimum credit score for a mortgage? ›

Credit score and mortgages

The minimum credit score needed for most mortgages is typically around 620. However, government-backed mortgages like Federal Housing Administration (FHA) loans typically have lower credit requirements than conventional fixed-rate loans and adjustable-rate mortgages (ARMs).

Can you get denied with a 800 credit score? ›

Your credit score isn't the only factor lenders consider when processing an application, which means even people with an excellent score risk being denied.

Top Articles
Latest Posts
Recommended Articles
Article information

Author: Aracelis Kilback

Last Updated:

Views: 6473

Rating: 4.3 / 5 (64 voted)

Reviews: 95% of readers found this page helpful

Author information

Name: Aracelis Kilback

Birthday: 1994-11-22

Address: Apt. 895 30151 Green Plain, Lake Mariela, RI 98141

Phone: +5992291857476

Job: Legal Officer

Hobby: LARPing, role-playing games, Slacklining, Reading, Inline skating, Brazilian jiu-jitsu, Dance

Introduction: My name is Aracelis Kilback, I am a nice, gentle, agreeable, joyous, attractive, combative, gifted person who loves writing and wants to share my knowledge and understanding with you.