New Mortgage Rules: Do You Still Need a 620 Credit Score to Buy a Home in Michigan?

https://www.youtube.com/embed/Nr-ONOGW_7M

For years, one sentence has quietly scared off more would-be homebuyers in Metro Detroit than almost anything else: "I don't have a 620 credit score, so I can't get a conventional mortgage." It became the number that decided whether you even got to start the conversation. As of late 2025, that hard 620 minimum is no longer the simple gatekeeper it used to be — at least on the Fannie Mae side, when your loan is run through Desktop Underwriter (DU).

But before anyone takes that as a blanket "anyone can buy now," let me give you the honest version, because plenty of headlines won't. Our team at Maceri Home Group works with Macomb County buyers across the full credit spectrum, and the buyers who actually win in this new environment are the ones who understand what truly changed, what didn't, and what to do next. Let's break it down clearly.

What Actually Changed

Fannie Mae updated its Selling Guide to align with its DU updates so that DU no longer applies a minimum credit score requirement. Instead of slamming the door on a single number, the system now uses a broader risk assessment to determine eligibility.

The timing details matter here. For new DU loan casefiles created on or after November 16, 2025, the 620 minimum for single-borrower loans — and the 620 average/median requirement for multiple borrowers — was removed. Several related DU changes took effect for loans submitted or resubmitted around the weekend of November 15, 2025. This all lines up with a broader shift heading into 2026, where mortgage qualification is moving toward more flexible, holistic evaluation rather than a rigid score cutoff, including the use of nontraditional credit factors.

In plain terms: a file that would have been auto-rejected last year can now actually get read on its full merits.

Does This Mean "Bad Credit Is Fine Now"?

No — and this is the part I want every buyer to hear clearly. What changed is that the underwriting engine no longer uses a single cutoff as its automatic first "no." That's meaningful, but it comes with three real-world reality checks.

Lenders can still have their own rules. Even when DU can approve a file without a hard 620 minimum, individual lenders are free to add their own stricter guidelines — what the industry calls "overlays." So the lender you walk into may still enforce a 620 (or higher) floor of their own, regardless of what Fannie Mae allows.

Pricing and mortgage insurance still care about risk. Your credit score can still affect your interest rate, your fees, and your mortgage insurance costs. That's why approval and affordability are two entirely different questions — a loan can technically approve and still carry a monthly payment that doesn't fit your budget.

The system may ask for more documentation. Fannie Mae's update also notes that in certain "thin credit" situations, DU may require lenders to establish a nontraditional credit history and/or homebuyer education — without relying on a credit score to trigger those requirements. It's a different path to "yes," not an automatic one.

Who Benefits Most From This Change?

This update is most helpful for buyers who are financially responsible but don't fit the classic credit-score mold. That includes "credit invisible" buyers who have no score at all simply because they don't use traditional credit, buyers with thin credit files and very limited history, and buyers actively rebuilding their credit who still have a stable job, manageable debts, and a consistent payment record.

If that sounds like you, the takeaway is simple: don't count yourself out based on old information. This direction fits the broader industry push toward incorporating more data into lending decisions, including newer scoring models that factor in things like rent payment history. The door is open a little wider than it was a year ago.

What Should Buyers Do Right Now?

If you're thinking about buying in the next three to twelve months, here's the clean play. Get pre-approved early — a real pre-approval, not just a casual pre-qualification. Have a lender actually run your scenario through DU and explain what's driving the result, so you understand your file instead of guessing at it. Document your consistency, because job stability, savings, and on-time housing payments carry real weight in this new framework. And avoid big credit moves right before you apply — no new cards, no large purchases, no closing out old accounts.

Real talk: this update can open doors, but you still want a clean plan so your monthly payment lands somewhere comfortable. Start by getting a feel for your numbers with our mortgage calculator, then confirm a comfortable price range using our affordability calculator. When you're ready to see what your budget actually buys, browse our 10,000+ property search.

The Michigan Angle: What I'm Seeing With Buyers

In markets like Metro Detroit and the surrounding suburbs, buyers win when they come prepared — full stop. Whether you're shopping in Macomb, Oakland, Wayne, or St. Clair County, the strongest offers consistently come from buyers who already know their true budget, their monthly payment range, and which loan programs actually fit their situation before they ever start touring.

This rule change helps, but the real advantage is clarity. Our team at Maceri Home Group works across these counties every week, and we know which local lenders have genuinely adopted the new flexibility versus the ones still quietly enforcing the old floor. That relationship knowledge is the difference between bouncing from one "no" to another and getting routed straight to a lender who can give you a real answer. We're backed by Keller Williams Platinum, one of the most active brokerages in the region, which gives us the network and resources to get you in front of the right people fast.

If you've been waiting on the sidelines because of your credit, this is a good moment to get a current answer instead of an outdated assumption. We'd welcome the conversation.

Frequently Asked Questions

Can I get a conventional loan with no credit score?

Possibly. DU may now allow eligibility without a minimum score, and in some cases lenders can build a nontraditional credit profile — using things like rent and utility payment history — depending on your file and the lender's requirements. It's not guaranteed, but it's no longer an automatic dead end.

Does this apply to FHA or VA loans?

No. This specific update is tied to Fannie Mae's Desktop Underwriter, which governs conventional financing. FHA and VA loans follow their own separate guidelines and carry their own lender overlays, and those didn't change with this update.

Is the 620 minimum completely gone forever?

The hard cutoff was removed for certain DU casefiles, but it hasn't vanished from the equation entirely. Risk-based pricing, mortgage insurance requirements, and individual lender overlays can still make lower-score borrowing more expensive — or harder in practice — even with the rule change.

What's the smartest first step if my score is under 620?

Get a lender to run your actual scenario through DU and explain the result, rather than assuming you don't qualify. Pair that with a clear budget and a comfortable monthly payment target, and you'll know exactly where you stand instead of guessing.

Ready to Find Out What You Actually Qualify For?

If you're wondering whether you can buy a home in Michigan — even if your score is under 620 or you don't have a score at all — Maceri Home Group is here to help. We'll connect you with a trusted local lender who can run your scenario the right way and map out a clear plan. Call or text Ryan Maceri directly at (586) 519-6259, or reach us by email at mhgrealtors@gmail.com. To get a quick start, just send over the city you want to buy in, your target monthly payment range, and whether you've already talked to a lender. You can also run your numbers with our mortgage calculator and affordability calculator, or browse our 10,000+ properties to start scoping your next move. We work hard, we know this market, and we're genuinely invested in getting you the right outcome — not just a closed transaction.