For veterans and active-duty members, these often have no official minimum score, though many individual lenders set their own "overlays" (usually around 580–620).
If traditional mortgages are out of reach, researchers point to more "creative" (though often riskier) financing: Hitting the Wall: Credit as an Impediment to Homeownership can you buy a house with poor credit
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. For veterans and active-duty members, these often have
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). Showing you have several months of "mortgage payments"
Showing you have several months of "mortgage payments" in savings after closing reduces the lender's perceived risk.
An insightful way to look at this is through the lens of Academic studies, such as those by Rosenthal (2002) and Bostic et al. , suggest that if low-credit households had "unblemished" credit, homeownership rates in the U.S. could increase by roughly 4 to 10 percentage points . 1. Traditional vs. Alternative Loan Paths
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