The Quick Read: It depends on the option, and the assistance provider’s floor is usually the one that controls. In the wholesale programs Lendmire arranges, the floor is 620 for the grant, 640 for the forgivable second and 660 for the repayable second. The refinance-cost second also sits at 660. FHA’s own minimum is lower, but it does not set the score you need for assistance. Qualification is subject to lender guidelines and full underwriting.
Three Floors, One Winner
The highest floor wins. Every assisted purchase has three layers, and each sets its own minimum score.
1. The first mortgage program. FHA, USDA or HUD-184 sets an agency floor, or in some cases no floor at all.
2. The lender. A lender can add an overlay above the agency floor.
3. The assistance provider. This layer is usually the binding one.
Say a buyer has a 600 score. FHA would allow the first mortgage. None of the assistance options in the network would, because every one sits at 620 or higher. The buyer is not “approved for FHA but denied for assistance” by mistake. It is simply the higher floor doing its job.
What Does FHA Itself Require?
FHA sets the floor under the file, not the floor for the assistance. HUD’s FHA answer page says eligibility turns on the Minimum Decision Credit Score. Below 500, a borrower is not eligible for FHA-insured financing. From 500 to 579, the maximum loan-to-value is 90 percent. At 580 and above, the borrower is eligible for maximum financing.
Maximum financing on a purchase is 96.5 percent leverage. That is where the 3.5 percent minimum investment comes from. The assistance options are built to cover that investment, which is why they sit on top of FHA.
Here is the catch. The 500-to-579 band needs roughly 10 percent down, and none of the assistance options start that low. A buyer at 560 can technically use FHA. That same buyer cannot use any of the four assistance structures until the score moves up.
Which Score Does the Lender Use?
FHA uses the median score when three are reported. When all reported scores are the same, that score is used, per the same HUD page. One low outlier among three scores does not drag the file down the way a lowest-score rule would.
For the assistance options, the test is the representative score, and on the grant it is the lowest representative score among all borrowers. That matters on a joint application. A co-borrower at 600 can sink a grant file even when the primary borrower sits at 700.
The second-lien options have one exception. A blended score can apply. A lower-scoring co-borrower’s score is averaged in when the primary wage earner earns at least 60 percent of household income and holds the higher score. The minimums then become 660 for the forgivable second and 670 for the repayable second, and an automated underwriting approval is required.
One more edge case from HUD’s page. If only a non-occupying co-borrower has a credit score, the lender must downgrade and manually underwrite a file that got an Accept recommendation. Repayable seconds do not allow manual underwriting at all. A non-occupant with the only score is a bad fit there.
The Four Options, Score by Score
Across the wholesale programs Lendmire places files with, four shapes of down payment assistance programs exist. Each has its own floor. Assistance is always a percentage of price or value, never a dollar promise, subject to program guidelines and full underwriting.
| Option | Min. Score | Amount | Repay? |
|---|---|---|---|
| Grant | 620 | 2% or 3.5% of price | Nothing to repay |
| Forgivable second | 640 (660 blended) | 3.5% of lesser of price or value | Forgiven after 36 or 60 on-time payments |
| Repayable second | 660 (670 blended) | 3.5% or 5% of lesser of price or value | Yes, balloon in year 10 |
| Refinance-cost second | 660 (670 blended) | 1% to 3.5% of balance | Yes, same terms as repayable |
Grant: 620
This is the lowest floor in the set. The grant covers 2% or 3.5% of the purchase price toward the FHA minimum investment. It is released at closing, with no lien, no payment and no interest. It pairs with FHA first liens only, at 96.5 percent leverage, on one to four units.
Score is not the only gate. Household income must be at or below 140 percent of area median income, unless the buyer fits a qualifying category. Those categories include first responders, educators, medical workers, civil servants, military personnel, first-time buyers, and buyers in underserved census tracts. An HUD-approved homebuyer education course is required. The grant is not offered in Washington.
Forgivable second: 640
The forgivable second is 3.5% of the lesser of price or appraised value. It carries no interest and no monthly payment. It is forgiven after the first 36 or 60 on-time first-lien payments, with no delinquency of 90 days or more. It pairs with FHA, HUD-184 and USDA first liens, on one to two units. Manual underwriting is allowed, and there is no income limit beyond USDA’s own on a USDA first lien.
Repayable second: 660
This one is a real loan, and it should be treated like one. It is 3.5% or 5% of the lesser of price or value. At 5%, the extra 1.5% goes toward closing costs and prepaid items. The second carries interest, a monthly payment, 30-year amortization and a balloon due in year 10. It has its own loan disclosure.
The tradeoff is clear. The floor is higher and manual underwriting is not allowed. In exchange, high-balance first liens are allowed, and the amount can reach 5%.
Refinance-cost second: 660
This one covers closing costs on an FHA refinance, at 1% to 3.5% of the balance. Combined leverage can reach 104 percent. It is never available on a streamline refinance, and never to refinance an existing assistance loan. The repayment terms match the repayable second.
What About USDA and HUD-184?
USDA and HUD-184 set no score floor that works like FHA’s, but the assistance layer still does.
USDA’s own program overview lists no specific minimum credit score. It also lists an alternative credit option and says a GUS “Accept” needs no credit score validation. The widely repeated 640 is a lender convention, not a USDA rule. The property must still be in an eligible rural area, and household income must be within 115 percent of median.
HUD’s Section 184 handbook goes further. The manual underwriting chapter says lenders must not use a borrower’s credit score to judge creditworthiness. A full credit report is still required, and creditworthiness is still a finding.
And the assistance on top keeps its own floor. With a USDA or HUD-184 first lien, only the forgivable and repayable seconds apply, at 640 and 660. The grant pairs with FHA only.
Key Terms Defined
Minimum Decision Credit Score (MDCS): the score FHA uses to decide eligibility, taken as the median when three scores are reported.
Representative score: the single score a lender assigns to a borrower for qualification, drawn from the credit report.
Blended score: an average that pulls in a lower-scoring co-borrower’s score, available on the second-lien options only under set conditions.
Overlay: a lender’s added rule stacked above the agency minimum.
Minimum required investment: the buyer’s contribution toward an FHA purchase, at least 3.5 percent of adjusted value per HUD’s glossary.
Balloon: a lump sum due at the end of a loan term, here in year 10 on the repayable second.
Do You Have to Be a First-Time Buyer?
No. None of the four options requires it. Repeat and move-up buyers qualify. The three-year first-time definition is only one of the grant’s qualifying categories.
Income works differently by option. The grant uses the 140 percent area-median-income test unless a category applies. The second-lien options carry no income limit beyond USDA’s on a USDA first lien.
Every option requires an owner-occupied primary residence. A second home or rental does not qualify. Nothing stacks with another assistance program either, and a mortgage credit certificate is not allowed with the second-lien options.
If Your Score Is Below the Floor
A score a little under a line is fixable. Work the order below.
1. Pull all three reports. Dispute anything wrong. A single error can hold a score under a floor.
2. Pay down revolving balances. Card utilization moves scores more than most buyers expect.
3. Stop opening new accounts. New inquiries and new debt both cut against the file.
4. Check the score the lender will use. On a joint application, the lowest representative score controls the grant.
5. Rescore before you apply. Recent changes need time to appear on the reports.
6. Compare shapes. A 625 score fails the forgivable second but clears the grant. Moving down a floor can beat waiting.
HUD-approved housing counseling is a low-cost route for buyers well below the floors. A counselor can map the steps in order.
Score timing matters near a line. A score sitting right on a floor is fragile. Recheck it before closing, because a late account or a new inquiry can push it under.
Credit Beyond the Score
The number is not the whole file. Late payments, collections and thin credit history can matter on their own. FHA allows buyers with non-traditional or insufficient credit to reach maximum financing, but only through manual underwriting, per HUD’s page.
The assistance options then add their own checks. The grant needs homebuyer education. The second-lien options follow the automated underwriting finding. Recent payment history on housing debt gets close attention across all of them.
Mechanically, a second lien also changes the file. A repayable second adds a payment that underwriting counts. A grant adds none. That is why the same score can fit one shape and be a poor fit for another.
Frequently Asked Questions
Can I get down payment assistance with a 620 score?
Yes, through the grant option, if the other conditions are met. It needs FHA underneath, income at or below 140% of area median income unless a qualifying category applies, and a homebuyer education course. The forgivable and repayable seconds start at 640 and 660, so a 620 score does not reach them.
Is FHA’s 580 the score I need for assistance?
No. FHA’s 580 only opens maximum financing. The assistance options set their own, higher floors, from 620 to 660. At 500 to 579, FHA allows 90% leverage, but no assistance option reaches that low. The exact numbers vary by lender and program and follow a full review of property, leverage, and credit.
Which score counts when two of us apply?
It depends on the option. FHA uses the median of three reported scores for each borrower. The grant looks at the lowest representative score among all borrowers. On the second liens, a blended score can apply when the primary earner brings in at least 60% of household income and holds the higher score.
Does USDA require a 640?
No. USDA’s own overview lists no specific minimum score and offers an alternative credit option. A 640 appears as a common lender benchmark. If you add a forgivable or repayable second to a USDA loan, that assistance layer sets its own floor.
Does a Section 184 loan need a credit score?
Not as a decision tool. HUD says lenders must not use the score to judge creditworthiness, though a full credit report and a manual review are still required. Section 184 itself provides no assistance, so any second lien on top keeps its own floor.
If You’re Buying a Primary Home
If you are buying a primary home and want to see whether a down payment assistance option fits your file, Lendmire can help you compare the grant, forgivable and repayable structures alongside an FHA, USDA or HUD-184 first mortgage. Program terms change, and every file is underwritten individually. This is not a commitment to lend.
Investors who want the broader program framework can review how DSCR loans work.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker licensed for consumer lending in 16 states. Lendmire arranges FHA, USDA and HUD-184 purchase loans with down payment assistance options through wholesale lenders; every file is underwritten by the lender under the applicable program guidelines. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. HUD FHA Resource Center: minimum credit score answer
2. USDA SFH Guaranteed Loan Program 101
This article is part of Lendmire’s down payment assistance program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Conventional Loan Requirements for a Down Payment Assistance Second Lien · Down Payment Assistance vs Gift Funds From Family · Can You Get Down Payment Assistance While Still Owning a Home?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Legal disclosures. Lendmire (NMLS# 2371349) is a state-licensed mortgage brokerage that arranges financing through wholesale lender relationships. Lendmire is not a direct lender, depository institution, or registered financial advisor. The discussion above is general informational content about real estate financing — it is not financial, legal, or tax advice, and readers should consult licensed professionals for guidance on their individual circumstances. Loan inquiries are subject to lender underwriting; this article does not represent a commitment to lend. Loan terms, rates, and qualification standards vary by borrower, property, and state, and are subject to change at any time. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.