My FICO credit score is "stuck" at 680. I have not had any late payments. I've had two car loans over the last 10 years that I paid on time and only one credit card that I pay off each month. How can I increase the score? I will be buying a home soon. What credit score do I need to buy a house?
There is No Set Minimum Score to Buy a House
The minimum credit score needed to buy a house is determined by the lender. Different lenders have different levels of risk tolerance and set different criteria, along with different cutoff points for the minimum credit score they are willing to accept.
There also are many different credit scoring models. Scores can vary widely based on the credit scoring model used and the range for that particular scoring model. For example, a credit score of 680 on a scale that goes up 950 is very different than a credit score of 680 on a scale that goes up 850. However, if you have a "good" score on one system, you'll almost certainly have a "good" score on other systems.
Credit scores are fluid numbers that fluctuate based on the information in your credit report at the time the credit score is calculated. Although you may pay your credit card off in full every month, your credit score will reflect the balance shown in your credit report at the time it is calculated.
Usually, your credit report shows the balance that appeared on your last billing statement. If you typically have a high balance on your billing statement prior to paying in full, your credit score may reflect that.
Anytime you are considering making a large purchase, it is a good idea to check your credit report and credit score at least several months in advance so that you have ample time to make any changes needed.
Focus on the Score Factors to Improve Your Credit
Your credit score should have come with a list of score factors. Risk factors describe the items from your credit report that are having the most impact on your score. Pay careful attention to those factors, as they will help you determine what you need to work on in your personal credit history in order to improve your scores.
The two most important factors in all credit scores are late payments and your credit card utilization rate, but there are other factors, such as the length of your credit history and your credit "mix," that also contribute.
Whether you are applying for something major such as a new home or a new car, or just looking to improve your general creditworthiness, the same basic rules will apply to increasing your scores:
- Bring any past due debts current
- Make all payments on time, every time
- Reduce balances on credit cards
If you focus on the factors provided with your credit scores and use the information to improve your credit history, in time, your credit score will improve. If you purchased your FICO score from Experian, you can view examples of the different score ranges and get a better idea of where you stand by checking out our list of FICO Score ranges.
Thanks for asking,
The "Ask Experian" Team