Technically, FHA financing allows a score as low as 580, but realistically, the interest rates (which are currently high compared to 2020) you will be offered with a low credit score will be as much as 2-3 points higher than someone with a 740 FICO score. That can result in one borrower paying several hundred dollars more per month than the other. Since it can be costly to re-finance a loan after a few years, it's best to do all you can to get to a score above 700, to help keep costs down both per month and over 30 years.
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