The Credit Score Myth That’s Holding Would-Be Buyers Back

Many would-be homebuyers aren’t on the sidelines because they don’t want to buy — they’re there because they believe they can’t. And more often than not, that belief comes down to one thing: credit score misconceptions.

According to a Bankrate survey, 42% of Americans think you need excellent credit to qualify for a mortgage. That assumption alone stops a lot of renters in their tracks. In fact, when asked why they haven’t purchased a home yet, “my credit isn’t good enough” is one of the most common responses.

Maybe that sounds familiar. You check your credit score, notice it’s not perfect, and immediately assume buying a home just isn’t realistic right now.

But here’s the truth many people don’t realize.

You Don’t Need Perfect Credit to Buy a Home

So where does this myth come from? Part of it stems from what today’s “typical” buyer looks like. According to the New York Fed, the median credit score for recent homebuyers is 775 — which is strong.

But median doesn’t mean minimum.

When you look closer at the data, you’ll see that a meaningful number of buyers qualified with lower scores. In fact, 10% of recent buyers had credit scores around 660, with some even below that range.

That means a less-than-perfect score doesn’t automatically disqualify you.

As FICO explains:

“While many lenders use credit scores like FICO Scores to help them make lending decisions, each lender has its own strategy, including the level of risk it finds acceptable. There is no single ‘cutoff score’ used by all lenders, and there are many additional factors that lenders may use…”

In other words, credit score is important — but it’s just one piece of the puzzle.

If your credit score has been the reason you’ve been waiting to buy, it may be time to take another look. Buyers with scores in the 600s are getting approved, and depending on your overall financial picture, you could be closer than you think.

The best next step? Have a conversation with a trusted local lender. They can help you understand where you stand, what loan options may be available, and whether a small improvement could make a big difference.

Your credit score matters — but it doesn’t have to be perfect.

If fear or misinformation has been holding you back from buying a home, don’t let assumptions make the decision for you. You don’t need all the answers to start the conversation — just the willingness to explore what’s possible.