What Credit Score Do You Need to Buy a Home or Land?
- LeNae Schwickerath
- Sep 7
- 2 min read
If you’re thinking about buying a home or land in Northeast Iowa or Southwest Wisconsin, one of the first questions that comes up is: “What credit score do I need?” As a local REALTOR®, I hear this all the time from both first-time buyers and experienced buyers looking to invest in property. Let’s break it down in a way that makes sense for today’s real estate market.
Why Credit Score Matters
Your credit score is one of the biggest factors lenders use to determine whether you qualify for a loan—and what interest rate you’ll pay. A higher score usually means lower monthly payments and more options for financing.
Credit Score Requirements by Loan Type
Conventional Loans: Generally, require a minimum score of 620. Stronger scores (700+) can give you better interest rates.
FHA Loans: Allow scores as low as 580 with a 3.5% down payment, or 500 with 10% down. This is often a good option for first-time buyers in smaller communities across Iowa and Wisconsin.
VA Loans: No official minimum, but many lenders prefer at least 620. A great option for veterans and active military in our area.
USDA Loans: Designed for rural buyers (perfect for many properties in Northeast Iowa and Southwest Wisconsin), typically require 640 or higher for streamlined approval.
Buying Land vs. a Home
Buying land often comes with slightly stricter lending requirements than a traditional home loan. Many banks want to see a higher credit score (around 680+) along with a larger down payment, since land doesn’t have a home as collateral.
Tips to Improve Your Credit Before Buying
Pay bills on time, every time.
Reduce credit card balances.
Avoid opening new accounts right before applying.
Check your credit report for errors and dispute them if needed.
The Local Advantage
Whether you’re buying your first home or land in New Hampton, Prairie du Chien, or Decorah, or looking for land in rural Northeast Iowa or Southwest Wisconsin, knowing your credit score is the first step toward success. A trusted local REALTOR® can connect you with lenders who understand our unique market and guide you through the process from pre-approval to closing.
Thinking about buying in Northeast Iowa or Southwest Wisconsin? Reach out today—I’d be happy to connect you with local lenders, walk you through your options, and help you find the perfect home or piece of land. 563-419-2195
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