Minimum Score Requirements
Most bank statement lenders require a minimum credit score between 620 and 700, depending on the program:| Credit Score | Typical Availability |
|---|---|
| 720+ | Best rates and terms, lowest down payments |
| 700-719 | Competitive rates, standard terms |
| 680-699 | Moderate rate adjustments |
| 660-679 | Higher rates, may require larger down payment |
| 620-659 | Limited lenders, significant rate premium |
| Below 620 | Few options available |
How Credit Score Affects Pricing
Bank statement lenders use rate adjustments based on credit tiers. A borrower with a 740 score might pay 0.5% to 1.5% less than someone with a 660 score on the same loan. Example impact on a $500,000 loan:| Credit Score | Approximate Rate | Monthly Payment |
|---|---|---|
| 740 | 7.00% | $3,327 |
| 700 | 7.50% | $3,496 |
| 660 | 8.25% | $3,752 |
Credit Score and Down Payment
Lower credit scores often trigger higher down payment requirements:| Credit Score | Typical Minimum Down Payment |
|---|---|
| 720+ | 10% |
| 680-719 | 15% |
| 660-679 | 20% |
| Below 660 | 25%+ |
Which Score Do Lenders Use?
Lenders pull credit from all three bureaus (Equifax, Experian, TransUnion) and typically use the middle score. If you’re applying with a co-borrower, they use the lower of the two middle scores.Improving Your Position
If your credit score is borderline, consider:- Paying down credit card balances to reduce utilization
- Correcting any errors on your credit report
- Waiting to apply until a negative item ages off
- Increasing your down payment to offset the lower score