What is the FICO score requirement for a Standard Conventional loan?

The FICO score requirement for a Standard Conventional loan is typically set at 620. This minimum score is established because lenders use it as a benchmark to assess the creditworthiness of a borrower. A score of 620 or higher suggests that a borrower has a reliable credit history and is likely to manage their debt responsibly, making them a lower risk for lenders.

When considering loans, the specific score of 620 reflects the guidelines provided by agencies that back these loans. Borrowers with a FICO score below this threshold may struggle to qualify for a Standard Conventional loan, and they might be directed to alternative loan products that cater to different credit profiles.

Understanding this requirement is crucial for buyers as it helps them prepare their finances ahead of applying for a loan and improves their chances of securing favorable loan terms. In contrast, options like a score of 500 or 580 are generally associated with other types of loans, such as FHA loans, which have different lending parameters than Standard Conventional loans. Similarly, the absence of a minimum score does not apply in the context of Standard Conventional loans, as lenders need a reliable measure to assess risk.