How to Purchase Your First Home Without Having the Perfect Credit Score

Giveaways 4 Mom

One of my goals, before I’m 30, is to be a homeowner. However, in my mind to purchase a home I need to have at least an 800 or better credit score to get the best deal. And even though my credit score isn’t bad I’m not in the 800 so to get in the process to be able to purchase my first home this year I had to get a little creative, therefore, I wanted to share with you some options that I explored and the option I decided to take to become a homeowner before I hit my 30s.

Look for Ways to Improve Your Credit Score

Always search for ways to improve your credit score. There’s no doubt that a better credit score will always make life easier for you.

But first of all, you need to know your credit score. Services like Credit Karma can help you get your credit report for free. Make sure you look at your report to make sure there are no mistakes.

Once you know your credit score it’s time to start building it. A company like Self Lender or Rental Kharma can help you boost your credit score. While I haven’t gotten started with Self Lender yet in the Facebook groups that I’m in they highly recommend both services. Rental Kharma helps you document your rent payments on your credit report and I started with them a week ago and I’m waiting to see if their services can get me into the 800 range that I’m aiming for.

You should also look to borrow small amounts from any credit cards you’re eligible for and then pay them back as soon as you can.

Finally, make sure you pay off any outstanding debts you already have. Make sure you pay the ones with the largest interest rates to start with.

Consider Renting to Own

You don’t have to let your credit score negatively affect your housing search when trying to purchase your first home.

Another option is to rent to own. These homes allow you to rent the home while your payments are going towards owning it. It’s the best of both worlds and they’re available even with a subpar credit score.

These are not in abundance, so the area where you want to rent to own will be a factor, but it’s worth looking into.

I’ve considered this option since I’ve always rented from landlords, so it is something that I stand behind if it’s the option that works best for you and your financial situation.

Consider Owner Financing or Taking Over Someone’s Mortgage

Lenders don’t want to lose money because someone is going to default on a mortgage. You can take over that mortgage legally and assume the rest of the cost.

All you have to do is pay out the mortgage buyout costs and any other associated fees. Just contact the lender and make your intentions clear.

Make sure you look at the terms and conditions, though. You will have to accept the lender’s terms and there’s much less room to negotiate. For example, in many cases, you will have to accept the house as is and won’t have the option to get it inspected or appraised.  Lenders like United Funding Corp are popular options for this type of agreement.

Therefore, it’s a viable option for getting your first home if you don’t have a good credit score.

In fact, this is the route I decided to take since credit doesn’t play a factor. Instead, I just pay a down payment of up to $10,000 and make regular rent payments and once it’s paid off it’s done and over with. Plus, in the meantime, I can make any adjustments to the house as I see fit without having to get a landlord’s approval.

Downgrade Your Current Place to Save More Money in Your Housing Fund

The other alternative to buying your first home with a less than stellar credit score is to offer a bigger deposit. Hard saving can get you on the housing ladder.

Try downgrading your current place by looking at cheaper rental options and then you can put more money into your housing fund.

The bigger your deposit the lower the credit score requirements.

However, keep in mind that if you have an awful credit score even a bigger deposit won’t help. That’s why I always recommend trying to improve your credit score as much as you can.

Even downgrading could free up more money to pay off your debts and thus improve your credit score.

I took this route a few years ago myself because I was sick of spending so much money paying for a place to stay that was never going to be my own. Now I’ve been able to save a lot more for my down payment to increase my odds of getting into a home if I do decide to go back to the more traditional route of a bank loan.

Final Thoughts on Purchasing Your First Home Without Having the Perfect Credit Score

Credit scores are everything during this age in time especially when it comes to purchasing a home. However, with a little creativity even if your credit score is in the high 600s to low 700s you can still be a homeowner without the high-interest rates.

Have you purchased a home without a perfect credit score? Share your tips in the comments section below.


  1. 5 Hacks for Increasing Your Credit Score | Giveaways 4 Mom says:

    […] See Also: How to Purchase Your First Home Without Having the Perfect Credit Score […]

  2. These are great pointers for first-time homebuyers. I know a friend who is looking into the purchase of a home and doesn’t have the best credit. Curious if she’s aware of these. I’ll be sure to share.

  3. Our credit scores are a mess due to student loans. I doubt we will ever own a home

  4. I didn’t know there is such a thing as rent to own. Now I wonder if there’s one available in our area. I will have to check. Thanks for these tips!

  5. Me and my husband are very careful in our finances so that we can always have a good credit score. These are great tips!

  6. It was so difficult for us when we were buying our first home. I think one of the reasons was we wanted to keep our standard of living, and had trouble realizing that we needed to save up a lot more to actually be able to afford a home. It took us some time but now we are proud homeowners, it’s a great thing

  7. This is some really great info. Making a good purchase with less than perfect credit has some challenges.

  8. These are awesome tips and very encouraging for people who don’t have the best credit score.

  9. This is a great resource for those first time home buyers. It is such a confusing time so it is nice to have a resource like this one!

  10. Terri Steffes says:

    While it is important to have a good score you won’t need a perfect one. That’s good as there are rarely any perfect people!

  11. This is such great information for people who think they can’t get a home. It’s better to invest if you can, rather than rent.

    1. admin says:


      I agree. I am super excited about becoming a homeowner soon myself.

  12. Purchasing a home is a big investment in time and money. These are great tips on making it happen even without a perfect credit score.

  13. We are looking to purchase our second home but I think these tips still apply. Home buying is a stressful situation any help is wanted!

  14. This is an excellent resource. Not everyone has the credit to freely buy a home the way a lot of people can. I’m glad it doesn’t mean that they just can’t buy a home.

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