Lenders take the middle of your 3 credit scores from Transunion, Equifax, and Experian and that is your qualifying score.
While FHA "technically" permits you to put 3.5% down with as little as a 580 credit score, lenders typically require a higher score. As the others have said, most lenders are requiring 620-640. My company requires only a 600 score.
Please bear in mind that just because you meet the minimum credit score requirement, that does not mean you will automatically qualify for a mortgage.
If your credit scores are in the high 500 to low 600 range there is usually a pretty good reason for it. If you have judgements or tax liens they will need to be paid. Non-medical collection accounts may need to be paid off as well.
If you have several late payments, or even worse, a bankruptcy or foreclosure, on your credit then in additions to meeting minimum credit score requirements you will also need to re-establish good credit. That means no late payments in the last 12-24 months.
Lenders want to see that you have made an effort to establish a good credit history and work on correcting mistakes you've made in the past. They want to lend to people who are good credit risks, not people who take their debt obligations lightly. SUSTAINED homeownership is the goal - not trying to get everyone to own as opposed to rent.
I can walk you though the process, and if you are willing to take the right steps and put in the effort, then you CAN own a home. Feel free to give me a call or email me and we can talk in more detail.
Loan Officer -NMLS #977416
WCS Lending, LLC
Toll Free: 866.936.5363 ext. 278