Credit scores play a crucial role in qualifying for most refinances, just like they did when you took out the initial mortgage.
For most conventional refinance loans, lenders typically require a credit score of at least 620. If you’re considering other loan types, the minimum scores can vary: FHA refinances may accept scores as low as 500, while jumbo loans often require a score of 700 or higher.
Understanding these benchmarks is key to navigating your refinance options. In this guide, we’ll break down the credit score requirements for different loan types, explore strategies for refinancing with bad credit, and share tips to improve your score before applying.
Highlights
- Your credit score plays a major role in refinancing—while 620 is a common minimum for conventional loans, government-backed programs offer more flexibility, and jumbo loans often require higher scores.
- FHA, VA, and USDA streamline refinance programs can help borrowers refinance with minimal or no credit checks.
- Paying down debt, correcting credit report errors, and maintaining on-time payments can boost your score before refinancing.
Refi.com’s Credit Score Requirements
For a refinance on your primary residence with Refi.com, you’ll need to meet the following:
620FICO credit score for FHA & conventional rate-and-term refinances- 620 FICO credit score for FHA cash-out refinances
- 660 FICO credit score for conventional cash-out refinances
What Credit Score Do You Need to Refinance Your Mortgage?
Having a good credit score is important when refinancing because this score directly affects the interest rate you’ll receive, the terms of the loan, and your overall eligibility.
Here’s a quick breakdown of the minimum credit score often required based on loan type. Keep in mind that lenders, like Refi.com, often have stricter overlays that require more than the program minimum.
| Refinance Loan Type | Minimum Credit Score* |
| Conventional | 620 |
| FHA | HUD requires 500 with 10% equity, 580 with less. Most lenders, like Refi.com, will require higher scores. |
| VA | No minimum set by the VA, but lenders generally require 620 |
| USDA | No minimum set by the USDA, but lenders generally require 640 |
| Jumbo | Generally 700+ |
“Lenders use your credit score as a primary measure of risk. The higher the score, the less risk they perceive – leading to more favorable loan conditions,” explains Dennis Shirshikov, a finance professor at City University of New York/Queens College.
The FHA loan program tends to be the most lenient with credit scores, though government-backed streamline refinance programs available for FHA, VA, and USDA loans often don’t require a credit check at all.
Other Factors
Keep in mind that other factors – including your assets, loan-to-value ratio (LTV), debt-to-income (DTI) ratio, and late payments – can also influence whether or not you will be approved for a refinance loan and what rate you will pay. So, even if your credit score matches your lender’s requirements, you’ll still have other requirements to meet.
For example, conventional refinances typically allow DTIs up to 45%, though some borrowers may qualify with up to 50% with strong compensating factors.
FHA refinances can go up to 56.9% DTI with strong compensating factors. VA loans and USDA loans, on the other hand, have no fixed limit but generally prefer DTIs below 41%.
Let’s take a closer look at the lowest credit score you’ll likely need based on the type of loan you choose.
Conventional Refinance
Conventional rate-and-term refinance: 620
Conventional cash-out refinance: 620–680
A rate-and-term refinance with a conventional loan typically requires a credit score of at least 620.
However, to access the best interest rates, aim for a score of 740 or higher. Anything below 620 might still get you approved, but the terms could be less favorable – such as higher interest rates or additional fees.
Cash-out refinances typically have stricter requirements since the lender has more money on the line. Therefore, expect a credit score requirement between 620 and 680 for most lenders.
FHA Refinance
FHA rate-and-term refinance: 500 with 10% equity, 580 with less (note that this is the minimum according to the U.S. Department of Housing and Urban Development (HUD). Lenders often impose stricter rules)
FHA cash-out refinance: 500 is the official HUD guideline, but most lenders require 600+
FHA streamline refinance: No credit check required (but lender overlays may apply)
An FHA refinance loan provides more flexibility with credit scores, permitting scores of 580 or even as low as 500 with 10% equity and compensating factors. However, those are just official guidelines, and individual lenders often have stricter requirements.
FHA streamline refinances don’t have a formal credit score requirement since no credit check is required if your current loan is in good standing. This makes it an excellent option for those with lower credit scores.
Having a clean mortgage payment history is important with an FHA refinance, especially if you are refinancing with the same servicer.
VA Refinance
VA rate-and-term refinance: 620 (lender-specific)
VA cash-out refinance: 620 (some lenders require 640+)
VA Interest Rate Reduction Refinance Loan (IRRRL): No credit check required
If you are a servicemember, veteran, or surviving spouse who qualifies for a VA refinance loan, the good news is that credit score requirements are generally more lenient than conventional loans.
While the U.S. Department of Veterans Affairs, which backs this loan, doesn’t have a minimum credit score requirement, many lenders require 620 or higher. Credit checks generally aren’t required for VA streamline refinances, also known as VA Interest Rate Reduction Refinance Loans (IRRRLs, pronounced “Earls”).
If you’ve had any late payments, however, you need to be current at closing and already participating in these VA loan programs.
USDA Refinance
USDA rate-and-term refinance: 640 (lender-specific)
USDA Streamlined refinance: 640 (lender-specific)
USDA Streamlined-Assist refinance: No credit check required
The USDA loan program, geared toward rural and suburban home buyers, doesn’t have official minimum credit scores. However, USDA lenders often require a credit score of 640 or higher for a standard refinance.
The USDA Streamlined-Assist refinance doesn’t require a credit check, while the similarly named USDA Streamlined does. These are two separate refinance loans with slightly different requirements.
Jumbo Refinance
Jumbo rate-and-term refinance: 680–700 (higher for best rates)
Jumbo cash-out refinance: 700–740+
Jumbo loan refinances often require a higher credit score — typically 700 or above — due to the larger loan amounts permitted and the increased risk for lenders, Shirshikov points out. If you’re refinancing to a shorter term — such as 15 years — your credit score may need to be 740 or higher.
Mortgage Refinance Options with Bad Credit
Refinancing when you have bad credit (as indicated by a credit score below 580) is challenging but not impossible.
Programs like the FHA Streamline, VA IRRRL, and USDA Streamlined Assist are specifically designed to help borrowers with less-than-perfect credit. But you can’t take cash out with any of these.
FHA Streamline Refinance
The FHA streamline refinance, for example, doesn’t have a formal credit score requirement — so long as you are current on your payments.
This is designed for existing FHA borrowers and is a viable option if your credit has dipped since you first obtained your loan.
VA Streamline Refinance / Interest Rate Reduction Refinance (IRRRL)
Similarly, the VA IRRRL allows veterans to refinance without a credit check or extensive documentation, focusing instead on payment history.
It’s designed to lower your interest rate or switch from an adjustable-rate to a fixed-rate mortgage, making it easier for veterans with poor credit to benefit from lower monthly payments.
The VA IRRRL is available for existing VA loans.
USDA Streamlined Assist
Additionally, the USDA Streamlined-Assist program also doesn’t require a credit check, provided your existing USDA loan is in good standing.
This program is available to existing USDA borrowers. It’s particularly beneficial for those in rural areas with less access to traditional refinancing options.
Note that the USDA Streamlined program, which is slightly different from the Streamlined-Assist program, does require a credit check.
Non-Qualified Mortgage (non-QM) Loan
If you still don’t have a sufficient credit score to qualify for these refinance programs, you may want to consider a non-qualified mortgage (non-QM) loan. This is a type of mortgage that doesn’t conform to the Consumer Financial Protection Bureau’s (CFPB) guidelines.
These loans are tailored for borrowers with non-traditional income or lower credit scores who don’t qualify for standard loans. Non-QM loans can be used for rate-and-term refinancing or cash-out refinancing.
These loans consider alternative documentation, such as bank statements, to determine your ability to repay. While interest rates may be higher with a non-QM refinance loan, they offer a path forward for borrowers with bad credit.
Or, try getting a friend or relative with better credit to co-sign your chosen mortgage refinance loan, which can improve your chances of getting approved. Just be aware that co-signers are legally responsible for the debt if you fail to make payments or default on the loan.
State and Local Refinance Assistance Programs
State and local programs may provide additional refinance options for those with poor credit. To see what’s available in your state, check your state housing finance agency’s website or contact a HUD-approved housing counselor. Some local credit unions and nonprofit housing organizations also offer refinancing support tailored to borrowers who don’t meet traditional lender requirements.
Compensating Factors Can Get You More Flexibility
If your credit score is below a lender’s typical requirement, compensating factors can sometimes help you qualify for a refinance. Compensating factors are financial strengths that reduce your risk as a borrower. These may include:
- A low debt-to-income (DTI) ratio (below 40%)
- Significant cash reserves (e.g., six months or more of mortgage payments saved)
- A strong payment history with no late mortgage payments in the past 12 months
- Stable, high income or a long employment history in the same field
For example, FHA loans may allow borrowers with scores as low as 500 if they have at least 10% equity and other strong financial indicators. Similarly, conventional loans may allow DTIs above 45% if a borrower has excellent reserves or a high income relative to their debts. If your credit score is on the lower side, demonstrating strong compensating factors may improve your chances of approval or better loan terms.
How Credit Score Impacts Refinance Interest Rates
Your credit score is one of the biggest factors in determining the interest rate you’ll receive on a refinance. Generally, the higher your score, the lower your rate. Lenders typically use risk-based pricing, meaning borrowers with higher scores are seen as less risky and rewarded with lower rates.
Here’s how your credit score might affect your interest rate:
- 740+ – Best rates available
- 700-739 – Competitive rates, slightly higher than the best tier
- 660-699 – Moderate rates, may pay 0.25%–0.5% higher
- 620-659 – Higher rates, often 0.5%+ more than top-tier borrowers
- Below 620 – Limited options, likely higher costs or loan restrictions
Even a small change in rate can significantly impact your monthly payment. For example, on a $300,000 loan, a 0.5% difference could mean paying $80–$100 more per month. If your score is borderline, improving it before applying can save you thousands over the life of your loan.
Here’s a quick look at how refinance rates have been trending:
How we source rates and rate trends
Rates based on market averages as of Dec 02, 2025.Product Rate APR 15-year Fixed Refinance 5.37% 5.42% 30-year Fixed Refinance 6.35% 6.37%
Tips for Raising Your Credit Score to Refinance
Fortunately, there are ways to increase your credit score before applying for a mortgage refinance. Here are the best practices recommended by the experts:
1. Pay down your credit card balances
Credit utilization, or the percentage of available credit you are using, has a significant impact on your score. Aim to keep your utilization below 30%. If you can, paying down your balances to 10% or less will maximize your score improvement.
2. Review and correct your credit reports
Get a copy of your three free credit reports and review them thoroughly to identify any unknown issues. If you spot any errors or inaccuracies, dispute them with the three major credit bureaus. This can improve your score over time.
3. Make timely payments
Payment history accounts for approximately 35% of your credit score, so ensuring that you consistently pay your bills on time is crucial. Even one late payment can noticeably damage your score, so it’s vital to build a solid on-time payment history at least six months before you apply for a refinance. Automating payments can help ensure you never miss a due date.
4. Avoid new credit inquiries
“Refrain from applying for new credit in the months leading up to your refinance, as each credit inquiry can temporarily lower your score,” Shirshikov advises.
5. Try secured credit cards
Consider getting a secured credit card, especially if you are rebuilding credit. Make small purchases and pay them off on time and in full to build your credit history.
6. Negotiate with creditors
If you are encountering difficulty, attempt negotiating payment plans with creditors to avoid negative marks on your credit.
The Bottom Line
Your credit score plays a big part in your ability to refinance and claim more affordable refi rates and terms. Check your score regularly and work to improve it by following proven tips and managing your finances responsibly.
“Refinancing is a powerful tool to manage your mortgage, but timing and preparation are everything,” says Shirshikov.
“Work closely with a financial advisor or mortgage broker who can help you navigate the complexities of the process and ensure you’re making the best decisions based on your financial situation.”
Ready to get started? Start your refinance application with Refi.com today.
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