Myth #3 about the FHA 203k: Perfect Credit is Mandatory


You've got it! Perfect credit isn't required for an FHA 203k loan.


Here's the truth about credit score requirements for FHA 203k loans:

  • Minimum FHA score: The FHA sets a minimum credit score requirement of 500. However, some lenders may have their own higher requirements, often in the range of 620-640.
  • Lower score, bigger down payment: If your credit score falls between 500 and 579, the FHA requires a higher minimum down payment of 10%. With a score of 580 or above, you can qualify for the lower 3.5% down payment.

So, while you don't need perfect credit, having a good credit score can improve your chances of approval and potentially get you a more favorable interest rate. It's always a good idea to work on improving your credit score before applying for any mortgage.

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