Buying a Home in San Diego With a Low Credit Score: What Your Options Are

by Trevor Landress

You can sometimes buy a home in San Diego with a lower credit score, but the score changes which loans you can use and what the loan costs. At the time this article was written, Fannie Mae's guide listed a 620 minimum score for fixed-rate loans that are manually underwritten, and 640 for adjustable-rate loans, while its automated system sets no single minimum.

The short answer

A credit score is a prediction of your credit behavior, and most scores range from 300 to 850.
You do not have one score. Each depends on the data and scoring model used.
Fannie Mae's manual underwriting minimum is 620 for fixed-rate loans and 640 for adjustable-rate loans.
Review your credit reports early so you have time to fix mistakes.

What a credit score is

The CFPB describes a credit score as a prediction of your credit behavior, based on information in your credit reports. Companies use scores to decide on mortgages, credit cards, auto loans, tenant screening and insurance. Most scores run from 300 to 850.

The CFPB also points out that you do not have just one score. A score depends on the data, the scoring model and the date used, so the number you see in an app may not match the one a lender pulls.

What the mortgage minimums look like

At the time this article was written, Fannie Mae's Selling Guide, which sets rules for many conventional loans, listed these minimums:

Loan situation	Minimum representative score
Manually underwritten, fixed rate	620
Manually underwritten, adjustable rate	640
Loans run through its automated system	No single minimum. The system weighs several risk factors.

The guide also says the applicable score depends on the loan to value ratio, the loan purpose, the number of units and your debt-to-income ratio. When there is more than one borrower, the lender uses the average median score. Lenders can add their own rules on top, which is why two lenders can give different answers. My guide to debt-to-income ratio covers the other number that moves with your score.

What affects your score

The CFPB lists the factors scoring models typically consider:

Your bill-paying history.
Your current unpaid debt.
The number and type of loan accounts you have.
How long your accounts have been open.
How much of your available credit you are using.
New applications for credit.
Any debt sent to collection, foreclosure or bankruptcy, and how long ago it happened.

Steps to take before you apply

Get your credit reports and read them line by line. The CFPB says to review them early so you have time to correct mistakes.
Dispute anything that is wrong, and keep copies of what you send.
Keep paying every bill on time, since payment history is on the list of factors.
Avoid applying for new credit before you buy.
Talk to a lender about the loan types that fit your score. A lender can tell you whether waiting a few months would change your options.

A low score can also change the price of the loan. A higher score can lead to a better interest rate or loan terms, according to the CFPB. If rates look high, my guide to rate buydowns and discount points explains one way buyers adjust the cost.

Should you wait or buy now?

That depends on how far you are from the minimum, how much time you would need to improve your report and your plans. Waiting can help if your score is close to a cutoff. It can cost you if you are renting in a market where prices or rates might move. I cover that question in buying now or waiting for rates to drop.

What this guide cannot promise

I cannot tell you what score you need for a specific loan, because lenders, loan programs and scoring models change. The numbers above come from one rule book for one group of loans. Ask a lender to pull your credit and explain your options in writing.

My advice for San Diego buyers

Pull your credit reports a few months before you plan to buy.
Fix mistakes first, since that is often the fastest improvement.
Keep every account in good standing until after closing.
Ask more than one lender about your options, since rules differ.
Do not finance a car or open new cards while you shop for a home.

A note on advice

I am a REALTOR®, not a lender, attorney, tax professional or financial advisor, so this guide is general information. Your lender can tell you what you qualify for, and a CPA or attorney can answer tax and legal questions.

Call or text me at (619) 402-4614 or send me a message.

Call or text (619) 402-4614 Contact Trevor Landress

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Frequently asked questions

What credit score do I need to buy a home?

It depends on the loan and the lender. At the time this article was written, Fannie Mae's guide listed 620 for manually underwritten fixed-rate loans and 640 for adjustable-rate loans.

How many credit scores do I have?

More than one. The CFPB says each score depends on the data, the scoring model and the date used.

What range do credit scores use?

Most credit scores range from 300 to 850.

Should I check my credit report before I apply?

Yes. The CFPB advises reviewing your reports early so you have time to correct mistakes.

Does a higher score lower my interest rate?

A higher score can lead to a better interest rate or loan terms, according to the CFPB. Your lender sets the actual rate.

About the author

Trevor Landress is a San Diego REALTOR® with Coldwell Banker West (DRE# 02126901). He was born and raised in San Diego and has been licensed since 2021.

Trevor helps homeowners sell, guides first-time buyers through the home buying process and assists investors with their next acquisition. His work includes negotiating offers, analyzing market trends, building pricing strategies and running marketing campaigns for his listings.

He serves clients across San Diego County, from coastal communities like La Jolla, Del Mar and Carlsbad to neighborhoods inland.

Trevor is part of the Campbell Group, a three-generation real estate team, and he and the Campbell Group consistently rank as a top producing team at Coldwell Banker West each month. He writes these guides to help San Diego buyers and sellers navigate an ever-changing market. To talk through your plans, call or text (619) 402-4614 or contact Trevor Landress.

How I help San Diego home buyers

I help buyers sort out their budget, understand their loan options with a lender, search for homes, write and negotiate offers, keep track of inspection and contingency deadlines and stay organized through closing.

How I help San Diego home sellers

I help sellers price their home, prepare it for the market, market it to buyers, review and negotiate offers and manage the steps from an accepted offer to closing.