Credit Myths

Here are common credit myths related to buying a home that you can share with clients or use in your real estate marketing:

1. “You need perfect credit to buy a home.”

Many people think they need a 750–800 credit score, but loan programs like FHA Loan Program allow buyers to qualify with scores as low as 580 (sometimes even lower with larger down payments).

2. “Checking your credit will hurt your score.”

When a buyer checks their own credit, it’s a soft inquiry and does not affect their score. Even mortgage lenders can run multiple checks within a short period and it usually counts as one inquiry.

3. “You must have 20% down to buy a home.”

That’s one of the biggest myths. Programs like FHA Loan Program allow 3.5% down, and VA Loan Program can offer 0% down for eligible buyers.

4. “Paying off all your debt will instantly raise your score.”

Paying off debt helps, but credit scores also depend on credit history length, payment history, and credit mix, so the increase may take time.

5. “Closing old credit cards improves your credit.”

Closing accounts can actually lower your score by reducing your available credit and shortening your credit history.

6. “One late payment won’t matter.”

Even one late payment can drop a score significantly and stay on a credit report for up to 7 years.

7. “You should stop using credit before buying a home.”

Lenders actually like to see responsible credit usage, not zero activity.