650 FICO? No Problem: The Best Mortgage Lenders for a 650 Credit Score in 2025

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A 650 credit score may not be bragging rights material, but it’s enough to secure competitive mortgage terms if you know where to look. We rounded up the best flexible lenders working with borrowers with more middling credit scores. 

According to FICO, which rates and tracks U.S. credit scores, the average American had a credit score of 717 in 2024. Does it follow, then, that a slightly below-average 650 credit score condemns you to limited or subpar mortgage lending options? Absolutely not: "A 650 credit score is a decent score," says Jeremy Davis, president of mortgage at Southern Bancorp. "It signals the borrower may have a few bumps on their report or could have a relatively thin credit file, but several loan options should exist for borrowers in this score range.” 

So while you might not qualify for the best rates, being slapped with a 650 FICO Score won’t lock you out of homeownership. The key is to know which lenders specialize in working with fair-credit borrowers and how to position yourself for mortgage loan approval. Below, we'll break down the best mortgage lenders for a 650 credit score and detail what your 650 score means.

Quick Winners List

• Best Overall: New American Funding
• Best for First-Time Homebuyers: CrossCountry Mortgage
• Best for Bank Statement Loans: Angel Oak Mortgage Solutions
• Best for Borrowers with Bankruptcy History: Rocket Mortgage
• Best for VA Loans: Veterans United
• Best for HELOCs: Figure

Best Overall: New American Funding

Pros:

• Accepts P&L statements for self-employed borrowers
• Offers FHA loans (scores as low as 580)
• Strong customer service and loan officer support
• Wide range of loan types (VA, jumbo, etc.)

Cons:

• Rates can be slightly higher than competitors
• Slower processing times due to manual underwriting 

Flexible underwriting is a bit of industry jargon you may hear when navigating the mortgage world, and it boils down to the idea that lenders evaluate mortgage applications more holistically. Rather than see a 650 credit score and place your application in its undesirables pile, a lender with flexible underwriting will forgo algorithms for more nuance. And New American Funding (NAF) is our best overall lender for borrowers with 650 credit scores because of its flexible underwriting. NAF also offers a range of loans, including FHA, VA, conventional and non-QM loans (a godsend for borrowers with non-traditional income, like freelancers). NAF's "I CAN" mortgage program for primary residences is especially valuable for borrowers, allowing them to set flexible terms on repayment between eight and 30 years. And you can qualify for I CAN with credit scores starting at 620. 

However, you should note that NAF's physical branches are a bit more limited (although they do cover 43 states), and some borrowers have found the online application process less streamlined than some fully digital lenders. NAF also errs on the side of slightly stricter debt-to-income ratio requirements than some competitors – something that may especially be a consideration for 650 credit score borrowers.

Best for First-Time Homebuyers: CrossCountry Mortgage

Pros:

• Accepts 580+ credit scores (FHA loans)
• Flexible down payment options (3% to 3.5%)
• Local loan officers for personalized service
• Self-employed-friendly underwriting

Cons:

• Fees can be higher than average
• Approval process may take longer

It's an intimidating era to be an aspiring first-time homeowner, so we understand if you need a little hand-holding while navigating the process. The good news: Regardless of where you live, CrossCountry Mortgage (CCM) offers an excellent partner lender to first-time homebuyers across the U.S. CCM specializes in low-down-payment options like FHA loans (requiring just 3.5% down) and boasts strong relationships with down payment assistance programs across the country. Loan officers are known for having a hands-on approach and explaining each process step – a crucial benefit for first-time homebuyers.

CCM offers a wide variety of loan programs that can accommodate financial situations that are more common among first-time buyers, such as loans for those who lack traditional biweekly pay stubs. Most pertinent to you and your credit score is that credit requirements fall well within the 650 score range. CCM is also known for working with borrowers to improve their credit position before applying. There are a few downsides: CCM's processing times can be slower than some competitors, and the online experience isn't as seamless as some fully digital lenders. Some borrowers also report that rates for middle-of-the-road credit aren’t always the most competitive.

Best for Bank Statement Loans: Angel Oak Mortgage Solutions

Pros:

• Specializes in non-traditional income verification
• No tax return required (bank/P&L statements OK)
• Fast pre-approvals for complex finances
• Investor-friendly loan programs

Cons:

• Higher interest rates (non-QM premium)
• Limited physical branches

Bank statement loans are a unique offering that every lender doesn't furnish. The lenders that do offer them tend to specialize in non-QM loans like bank statement loans, which have the "non-QM" or non-qualified designation because the government doesn't back the loans. Angel Oak is among those fewer lenders that embrace the unique financial situation of self-employed gig workers, small business owners and other folks with non-traditional income, offering bank statement loans to borrowers with credit scores in the 650 range.

According to the 2025 U.S. Bureau of Labor Statistics, there are more than 16.4 million self-employed workers in the U.S. So it’s much-needed that lenders like Angel Oak accept bank statements in lieu of tax returns, which don't always paint an accurate financial picture for the self-employed. Just note that compared to conventional loans, bank statement loans come with tradeoffs - interest rates are typically 0.5% to 1% higher than conventional loans, and certain fees can be steeper. They also require larger down payments (often 20% or more) than standard FHA or conventional loans. For the right borrower, though - someone with robust strong cash flow but non-traditional documentation - Angel Oak is a lender offering a vital mortgage solution for the self-employed.

Best for Borrowers with Bankruptcy History: Rocket Mortgage (formerly Quicken Loans)

Pros:

• Accepts borrowers 1-2 years post-bankruptcy
• Fully digital application process
• Fast pre-approval decisions
• Wide loan product selection

Cons:

• Less personalized service
• Strict DTI requirements

Rocket Mortgage (formerly Quicken Loans) is our top choice for borrowers with recent bankruptcies, thanks to its willingness to work with applicants on FHA loans as soon as two years after the discharge of a Chapter 7 bankruptcy (for borrowers with at least a 580 credit score). After the four-year mark, borrowers gain access to a wider range of mortgage options, including Rocket Mortgage's ONE+ program, a conventional loan that requires just a 1% down payment for borrowers with at least a 620 credit score. The online lender’s technology-driven approach also allows Rocket Mortgage to efficiently assess post-bankruptcy applicants, providing faster decisions than traditional lenders. The platform has strong educational resources about rebuilding credit if you want to try to bump up your score before taking out a loan.

The main drawbacks include the upfront hard credit pull requirement (versus a "soft pull,” which does not affect your credit score). Additionally, rates for post-bankruptcy borrowers tend to be higher than for conventional applicants, although that's to be expected with any lender. Some borrowers also find Rocket Mortgage's automated system can be less flexible than working with a human loan officer when explaining special circumstances related to their bankruptcy.

Best for VA Loans: Veterans United

Pros:

• Specializes in VA loan expertise
• 580 minimum credit score
• No down payment required
• Dedicated military support team

Cons:

• Only for eligible military borrowers
• Slower closing times

It probably comes as no surprise that Veterans United is a leader in the VA loan space. The lender offers exceptional expertise and benefits tailored to military borrowers. For those with 650 credit scores, Veterans United provides $0 down payment options with no private mortgage insurance (PMI) requirements – one of the unique benefits afforded to VA loans. Its loan officers are specially trained in VA guidelines and understand military pay structures, deployments, and other unique aspects of military service that can affect mortgage applications.

Veterans United is also known for helping veterans with underwriting issues, like a thin credit file, especially if credit issues relate to deployments. And while technically there's no minimum credit score requirement for VA loans, borrowers with 650 scores should get better rates and terms. 

Best for HELOCs: Figure

Pros:

• Fully online application
• Fast approvals (five-minute prequalification)
• No appraisal required
• Fixed-rate options available

Cons:

• Higher rates than traditional banks
• Limited to HELOCs only

Figure, which stands out for its transparent pricing and competitive rates, has emerged as one of the best online HELOC lenders for borrowers with 650 credit scores – especially those who value speed and digital convenience above an in-person experience. Using blockchain technology to streamline the mortgage process, Figure can offer pre-approval in as little as five minutes, and closing loans in five days or less in some cases. Just note its HELOC origination fees can be a bit hefty. But suppose you're interested in a HELOC or cash-out refinancing. In that case, Figure is a solid option for 650-credit homeowners looking to tap equity, especially for tech-savvy borrowers who prefer the process be entirely from their phone or computer. 

What Kind of Credit Score is a 650?

“If your score is 650, it falls in the ‘fair’ category, albeit on the high end of that segment’s range,” says Omer Reiner, president of FL Cash homebuyers, LLC. “You can get a mortgage loan, but you will pay a higher rate than borrowers with a higher credit score because you are seen as a higher risk for lenders.”

Notching a small bump in score, Reiner says, may be worth pursuing before looking at loan options: “Bumping your score up to 670 pushes you into the ‘good’ category, which typically also labels you as an acceptable risk, or at least a lower risk than applying for a home loan at 650,” he says. 

You can bump your score by making on-time payments, refraining from opening new lines of credit and generally showing some restraint on your purchasing. That restraint should extend until the deal is sealed: “I have seen people qualify for a home loan and then head out to purchase a bunch of things for their new home before the loan closes and not be eligible for that loan when they expected to close,” Reiner says. “Stay very conservative in your financials once you are approved for any mortgage loans until you have signed the loan papers and moved in.”

Davis also suggests taking care of any outstanding “Buy Now Pay Later” accounts, which can easily become a “poison pill” for aspiring homeowners, he says. He notes to also avoid quick-cash loans like payday advances, car title loans and check cashing advances.

However, if you’ve done all you can to boost your credit score, and 650 is what you find yourself with for the foreseeable future, apply for an FHA loan if possible, Reiner suggests, citing the less strident requirements than a conventional loan. 

Why You Should Trust Us

The author, Emma Witman, brings experience writing about personal finance topics, emphasizing conducting deep industry research and interviews with lending professionals. Furthermore, Benzinga’s editorial standards prioritize accuracy and transparency. We independently assess lender offerings – from rate competitiveness to customer service – so you can trust that our picks are tailored for borrowers with 650 scores. 

Methodology 

To identify the top lenders for borrowers with 650 credit scores, we analyzed over 50 mortgage providers, focusing on those with specialized programs for fair-credit applicants. Our evaluation prioritized underwriting flexibility and including non-QM loans with competitive terms for scores in the 620-680 range. Lenders with sophisticated online tools were also given added consideration. Further, we scrutinized BBB ratings, Trustpilot and borrower testimonials to highlight lenders with solid reputations. For deeper insights, explore our full methodology.

FAQ

Sources

• Bureau of Labor Statistics. Accessed Mar. 25, 2025. https://data.bls.gov/pdq/SurveyOutputServlet
• Interview with Jeremy Davis, president of mortgage at Southern Bancorp, via email on Mar. 25, 2025.
• Interview with Omer Reiner, president of FL Cash homebuyers, LLC, via email on Mar. 23, 2025.
• Online lender information sourced from company websites, including Angel Oak Mortgage Solutions, CrossCountry Mortgage, Figure, New American Funding, Rocket Mortgage and Veterans United.
• Review data sourced from Trustpilot and the Better Business Bureau (BBB).