What Credit Score Do You Need to Refinance? (2026 Minimums)

Q: Can I refinance with bad credit?

It depends on your loan type and how you define 'bad credit.' FHA Streamline refinances can be done with limited credit review if you already have an FHA loan and a strong payment history. VA IRRRL refinances for existing VA borrowers are similarly flexible. Conventional refinances typically require at least 620. If your score is below these thresholds, spending 6 to 12 months building it up before applying will likely get you a significantly better rate.

Minimum credit scores by refinance type

There is no single universal minimum. Guidelines differ by loan program, and individual lenders can — and often do — set "overlays" that are stricter than the program minimums. The table below shows typical thresholds; your lender will tell you exactly what they require.

Refinance type	Typical minimum score	Notes
Conventional rate-&-term refi	620+	Best pricing at 740+; PMI may apply below 20% equity
Cash-out refinance (conventional)	620–680+	Higher LTV increases score requirements; 640–680 common
FHA Streamline refi	Flexible (often 580+)	Reduced credit review for on-time FHA borrowers; lender-driven
FHA cash-out refi	580+	580 minimum for 3.5% down; MIP required; max 80% LTV
VA IRRRL (streamline)	No VA minimum (lender: 580–620)	VA-to-VA only; minimal documentation; no appraisal in most cases

For a deeper look at refinancing programs generally, see our mortgage refinance overview. If you have a VA loan, our VA loan guide covers IRRRL eligibility in detail.

Why your score affects your rate

Your credit score is one of the primary inputs lenders use to price a mortgage. A higher score signals a lower statistical risk of default — which means the lender can offer a lower interest rate. This isn't just a small rounding difference. Moving from a 640 to a 740 can shift your rate by 0.5% or more on a conventional loan. On a $350,000 refinance, that gap could be worth $100 or more per month.

Lenders use risk-based pricing tiers, often called "loan level price adjustments" (LLPAs) on conventional loans backed by Fannie Mae or Freddie Mac. These adjustments interact with your loan-to-value ratio as well: a borrower with a 620 score and 90% LTV will typically pay significantly more than one with a 740 score and 70% LTV. The same logic applies, in softer form, to FHA and VA loans.

Rule of thumb: Every 20-point jump in score from 620 to 760 tends to unlock a better pricing tier. If you're sitting at 618, it may be worth waiting a few months to cross 620 — and if you're at 680, getting to 700 or 720 can still improve your rate meaningfully.

How to refinance with a lower score

If your score is below the conventional threshold, you're not necessarily locked out of refinancing. Here are the most common paths:

FHA Streamline refi: If you currently have an FHA loan, the FHA Streamline program is designed for you. It requires limited documentation, often no appraisal, and minimal credit review — the focus is on your payment history, not your score. You must be current on your mortgage and demonstrate a "net tangible benefit" (typically a lower rate or payment).
VA IRRRL: If you have an existing VA loan, the Interest Rate Reduction Refinance Loan is one of the most accessible refi programs available. The VA does not set a minimum score — though your lender may. Your payment history on the existing VA loan matters most.
Non-QM or portfolio lenders: Some lenders hold loans on their own books and can underwrite outside standard guidelines. These loans often carry higher rates, but they can be an option for borrowers who don't fit conventional boxes.
Add a co-borrower: If a spouse or qualified family member has a stronger credit profile, adding them to the loan may help you qualify and improve the rate offered.

Not sure which path fits your situation? Our should-I-refinance guide walks through the decision from a broader angle.

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How to raise your score before refinancing

If you have a few months before you need to refinance, a focused effort can move your score meaningfully. The five factors that make up a FICO score are weighted as follows: payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%), and credit mix (10%). The first two give you the most leverage.

Pay down revolving balances. Credit utilization — what you owe on credit cards relative to your limits — is the single fastest lever. Getting your total utilization below 30% (and ideally below 10%) can add points within a billing cycle or two.
Make every payment on time. A single 30-day late payment can drop your score significantly. Set up autopay for minimums on all accounts to prevent missed payments.
Dispute errors on your credit report. Request your free reports at annualcreditreport.com and check all three bureaus. Incorrect late payments or accounts that aren't yours can be disputed and removed, which may improve your score.
Avoid opening new credit accounts. New inquiries and accounts lower your average account age and add hard pulls. Hold off on applying for new credit cards or loans in the months before refinancing.
Don't close old accounts. Closing accounts reduces your total available credit and can hurt utilization. Leave older accounts open even if you're not actively using them.

Significant score improvements take time — typically 3 to 12 months of consistent behavior. But even a 20–40 point improvement may move you into a meaningfully better pricing tier and save thousands over the life of your refinanced loan.

Once your score is where you want it, use our guide on how to compare mortgage lenders to make sure you're getting the best rate for your profile, not just the first one offered.

Frequently asked questions

It depends on your loan type and how you define "bad credit." FHA Streamline refinances can be done with limited credit review if you already have an FHA loan and a strong payment history. VA IRRRL refinances for existing VA borrowers are similarly flexible. Conventional refinances typically require at least 620. If your score is below these thresholds, spending 6 to 12 months building it up before applying will likely get you a significantly better rate.

Generally, scores of 740 and above unlock the most favorable pricing tiers on conventional refinances. The improvement from 620 to 740+ can mean a meaningfully lower rate and no requirement for private mortgage insurance. That said, exact cutoffs vary by lender, loan type, loan-to-value ratio, and market conditions — so it always pays to compare multiple offers.

There is a modest, temporary impact. When you formally apply with a lender, a hard credit inquiry is recorded, which typically reduces your score by a few points for a short period. If you rate-shop with multiple lenders within a 14 to 45 day window, the major scoring models treat those as a single inquiry — minimizing the effect. Lendspedia's initial matching uses a soft pull only, so checking your options through us has no score impact at all.

Cash-out refinances generally have higher credit requirements than rate-and-term refinances because you are increasing your loan balance. Most lenders require at least 620 for a conventional cash-out refi, and many prefer 640 to 680 or higher, especially at higher loan-to-value ratios. FHA cash-out refinances typically require 580 or better. VA cash-out refinances have no VA-set minimum, but individual lenders often impose their own floors, commonly 580 to 620.

This guide is for general educational purposes only and is not financial, legal, or tax advice. Credit score thresholds, rate tiers, and program guidelines vary by lender and change over time. Consult a licensed mortgage professional for guidance specific to your situation.