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Credit Scores – What do they mean?

Credit Scores & What They Mean for a Mortgage

For mortgage applications, we use Equifax scoring. If you’re currently checking your credit through online banking or platforms like Credit Karma, those typically use TransUnion, which can show different results than what lenders see. I recommend downloading Borrowell, as it uses Equifax. While the score may not be exact, it gives a strong estimate and helpful insight into what we’ll be reviewing.

It also shows:

  • Your credit history over the past few years
  • Any items in collections
  • Weekly updates to your score
  • Tips on how to improve your credit, and explanations if your score decreases

 Below 600 -640

  • Limited options
  • Higher Down Payment Required
  • Likely need alternative or private lenders
  • Higher interest rates
  • Lower borrowing power

    640–679

  • Some options available
  • May still need alternative lenders depending on the file
  • If accepted by a A lender less borrowing power than someone with a higher credit score.

    680 and Above

  • Strong range
  • Access to most lenders
  • Good borrowing power and better rates
  • Maximum borrowing power available

Why Credit Score Matters

Your score impacts:

  • Interest rate you qualify for
  • Which lenders will approve you
  • How much you can borrow

👉 Lower score = higher rate = higher monthly payment
👉 Higher payment = lower approval amount

If you are applying with a partner and one has a credit score of 670 and the other has 720 we can put the one with the higher credit as primary borrower to take advantage of the better mortgage options in most situations.

Real Example

Two buyers, same income:

  • Person A: 620 score → higher rate → qualifies for less
  • Person B: 720 score → lower rate → qualifies for more

👉 Same income, different outcome

 How to Increase Borrowing Power Through Credit

  • Pay all bills on time
  • Keep credit card balances below 30% (ideally lower)
  • Avoid applying for new credit before buying
  • Don’t close old accounts (they help your history)

 Pro Tip

Even if your score isn’t perfect, there are still options.

👉 It’s not about being perfect — it’s about placing your file with the right lender

Bottom Line

Your credit score is one of the biggest drivers of your mortgage approval.

👉 Better score = better rate = more home buying power