Common Credit Questions Answered: What Colorado Springs Homebuyers Actually Need to Know

A Mortgage Tool Bus Guide to Scores, Myths, and Fresh Starts

🚌 Bus Stop #1 — What credit score do I actually need?

Think of your score less like a locked gate and more like which lane gets you on the highway. FHA's lane opens at 580 for the standard 3.5% down payment; drop to 500–579 and you're still eligible, just with a 10% down requirement (HUD Handbook 4000.1). VA doesn't set a published minimum at all — the VA insures the loan, not the credit file, so it's individual lenders who set their own overlay, commonly in the 580–620 range. Conventional loans backed by Fannie Mae removed their hard 620 minimum from the automated underwriting system in November 2025, replacing it with a more holistic risk review — Fannie Mae itself has said the practical impact is small, and most lenders still prefer 620+ in practice.

🚌 Bus Stop #2 — Does checking my own credit hurt my score?

No. Checking your own report is a “soft” pull and has zero effect. When a lender pulls your credit for pre-approval, that's a “hard” pull, and it does register — but the CFPB confirms that as long as you get all your mortgage quotes within a 45-day window, multiple lender pulls count as a single inquiry, not several. Shop around. Bunching your applications protects your score either way.

🚌 Bus Stop #3 — Do I need to close old credit cards before I apply?

Generally, no. Closing an account can shorten your average credit history and shrink your available credit, both of which can nudge your utilization ratio the wrong direction. Unless your loan officer flags a specific reason, leave old accounts open — even ones you don't use much.

🚌 Bus Stop #4 — I don't have much credit history because of military moves. Can I still qualify?

This comes up a lot with our Fort Carson, Peterson, and Schriever families, and the answer is yes. Both FHA and Fannie Mae allow manual underwriting using nontraditional credit — things like a documented rent history, utility payments, and insurance payments — when a borrower doesn't have the standard three tradelines. It's more paperwork, not a dead end.

🚌 Bus Stop #5 — How long after bankruptcy or foreclosure can I qualify?

This is where the loan type really matters:

Note on VA: unlike FHA and Fannie Mae, the VA itself doesn't publish a fixed waiting period — it's set by individual lenders, so this varies more by who you work with.

🚌 Bus Stop #6 — Does paying off a collection account raise my score right away?

Not always instantly, and this is one to talk through with your loan officer before you pay anything off — sometimes a paid collection still shows on the report and the scoring impact is smaller than people expect, and sometimes there's a smarter order to pay things off in. This is a “call before you act” moment, not a DIY one.

Helpful Tools

Explore your options on the FHA Loan page, VA Loan page, and Conventional Loan page at mortgagetoolbus.com, or check out the Homebuyer Roadmap for the full picture.

Frequently Asked Questions

Is there a minimum credit score for CHFA down payment assistance?

Most CHFA loan programs require a credit score of 620 or higher.

What's the difference between the score I see on a free app and the score my lender pulls?

Consumer apps often show a VantageScore-based model; mortgage lenders typically pull a specific FICO score version from all three bureaus, which can differ from what you see on your phone.

Colorado Springs-specific: Does a PCS move reset my credit-building clock?

Not automatically — but frequent address changes can make it harder for some scoring models to verify a stable history, which is part of why nontraditional credit documentation (Bus Stop #4) matters more for military families here in El Paso County.

Can medical debt hurt my mortgage application?

It can. A federal rule that would have banned medical debt from credit reports entirely was struck down by a court in July 2025, so there's no blanket protection at the federal level right now. Credit bureaus still voluntarily exclude medical collections under $500 and any paid medical collection — but mortgage lenders typically use older scoring models that don't get the benefit of those newer-model exclusions, so a medical bill can still show up in your mortgage score even if it's invisible elsewhere.

❤️ Let’s Go Home

— Kat Fish
Mortgage Tool Bus
NMLS #2609071