When buying a home, lenders will mostly check your credit history to assess your chances of repaying the loan. But what if I don’t have any credit history? Maybe you’ve never used a credit card, never photographed a loan, and your credit profile is too thin to generate a score. “Can I get a mortgage without a credit history?” The answer is yes. It’s more difficult and you need to show your financial responsibility to the lender in other ways.
Whether you’re browsing a home for sale in Los Angeles, California or planning on purchasing in Chicago, Illinois, Redfin will show you your options, what your lender is looking for, and how to qualify.
Why credit history is important to lenders
Credit reports and scores quickly snapshot your lenders how you manage your debt. Without this data, lenders don’t have a standard way to measure risk. That doesn’t mean you’ve automatically been disqualified, but you need to prove financially reliable through alternative documents.
>>>Read: What credit score do you need to buy a house?
No credit and poor credit
Many people believe that having no credit history is the same as poor credit, but lenders see them differently.
No Credit: There is not enough credit history to generate a score. This usually occurs when you have never used any other form of debt reporting with a credit card, loan, or credit office. This is not automatically negative, but some lenders may be considered a risk because they have no track record of repayments to review.
Bad Credit: There is a credit score but reflects missed payments, defaults, high debt levels, or other financial issues. Unlike no credit, bad credits show a track record of risk, making it difficult to qualify for a mortgage or secured terms.
Important Takeout: You are eligible for an FHA, VA, or USDA loan if you can view solid payment history through alternative documents without credit. If you have a bad credit, you may need time to improve your score before it is approved.
Options for getting a mortgage without a credit history
1. FHA loan
The Federal Housing Administration (FHA) offers programs designed for borrowers with limited credit history, or no history. Lenders can establish a pattern of payments on time using non-traditional credit references such as rental history, utility bills, insurance premiums, and mobile phone bills.
2. VA loan
For eligible veterans or active duty service members, VA loans can be a strong option. VA guidelines are more flexible and allow lenders to rely on alternative credit data instead of traditional credit scores.
3. USDA loan
For rural and suburban buyers, USDA loans may allow manual underwriting if credit history is missing. Again, a consistent payment history from non-traditional accounts is useful.
>>>Read: How to Find and Buy a USDA Eligible Home
4. Manual acceptance
Some lenders do not rely solely on automated systems, but instead review their financial situations manually. They see:
Rental Payment History Utility Billing Insurance Premiums are bank statements that show consistent savings habits
Manual underwriting takes time, but you can demonstrate reliability without a credit score.
>>>Read: Types of Home Loans
What lenders want to see instead of credit
Without a score, lenders can request additional documents such as:
Proof of consistent rent payment (12 months of check or statement) Utility or services Payment record Stable employment and income verification Low debt-to-income ratio (DTI) Large down payment (sometimes over 10-20%)
Tips for improving your approval chances
With the exception of larger down payments, it reduces the risk to lenders and makes approval more possible. Show stable employment: the longer you get along with your employer, the better. Maintain strong savings: Bank statements that show you have emergency funds can help you build trust. Consider co-signers. Those with established credits can enhance their applications. Start building your credits now. Even secured credit cards and small loans reported to the Credit Bureau can help you establish track record before applying.
Do I need to create a credit before I buy?
If you’re not buying in a hurry, building a credit profile can make the process smoother and potentially unlock better interest rates. Even six months to a year of responsible credit use can greatly improve your options.
>>>Read: How to improve your credit score before buying a home
Frequently Asked Questions about getting a mortgage without a credit history
1. Can I get a mortgage if I don’t have a credit score?
yes. Some lenders either use manual underwriting or accept alternative credit data such as rental history, utility payments, and bank statements to approve borrowers without a credit score.
2. What loans are available to buyers without a credit history?
FHA, VA, and USDA loans are the most common programs that allow applicants without a credit history. These loans often accept non-traditional credit references rather than credit scores.
3. If you don’t have a credit history, do you need a larger down payment?
sometimes. A larger down payment (over 10-20%) can help offset lenders’ risk and increase approval. For FHA loans, the minimum down payment is still 3.5%, but you can enhance your application by offering more, especially if your credit history is limited.
4. Can I use rent payments as proof of credit history?
absolutely. As documented, on-time rent payments are one of the most powerful forms of alternative credits that lenders will consider during manual underwriting.
5. Do I need to create a credit before applying for a mortgage?
If you’re not buying in a hurry, building a credit first will help you qualify and secure a lower interest rate more easily. Responsible credit use for 6-12 months can make a difference.
6. Is it easier to rent an apartment without credit than to buy a house?
yes. Normally, renting an apartment is a lower requirement, but the landlord may still require proof of income, a higher deposit, or a co-signer if you don’t have credit.
Final Results on Getting a Mortgage Without Credit
You can get a mortgage without a credit history, but you will need additional effort and a proper loan program. FHA, VA, and USDA loans offer flexible routes and manual underwriting provides an alternative way for lenders to assess your financial liability. By preparing your documents, saving for a strong down payment, and showing stability in income and expenses, you can achieve homeownership without a traditional credit score.
