Research indicates that while "poor" credit—typically defined as a or a CIBIL score below 650 —presents a significant barrier to homeownership, it does not make it impossible.
Most traditional lenders prefer a score of at least for conventional loans. However, several government-backed programs are specifically designed for lower-credit borrowers: can you buy a house with poor credit
Newer underwriting models, such as FICO 10T and VantageScore 4.0 , are beginning to incorporate positive rental history into credit files to help "thin-file" or low-credit borrowers. 3. High-Interest & Non-Traditional Alternatives The "Compensating Factors" Strategy Backed by the Federal
Targeted at rural development, these generally require a 640 score, but can offer exceptions for applicants with "compensating factors" like a very low debt-to-income ratio. 2. The "Compensating Factors" Strategy these generally require a 640 score
Backed by the Federal Housing Administration, these allow scores as low as 500 (with a 10% down payment) or 580 (with a 3.5% down payment).