Does an Applicant With a Credit Score of 580 Need a Co-Signer for a Mortgage?

A 580 credit score may close the door on a mortgage.

A 580 credit score may close the door on a mortgage.

If you have a low credit score, such as 580, your chances of being approved for a mortgage are very low. To obtain a mortgage, you'll either need to increase your score or prove to the lender in some other fashion that you will make your payments on time. Having a co-signer for your mortgage might give your lender some reassurance that you are a better risk.

Mortgage and Credit Scores

Whenever you apply for a loan such as a mortgage, the lender will want to know if you are a good investment. Mortgage lenders make money by giving loans to borrowers and charging them interest on the money borrowed. However, lenders won't make money if you fail to pay the loan back on time. To determine if you are a good candidate and make the lender money, lenders assign you a credit score, a numerical representation of your credit history. The higher your score, the better your chances of obtaining a loan.

580 Score

Not all credit score calculation systems use the same numbering system, but one of the most commonly used scores, known as a FICO score, ranks credit scores from 300 to 850. In general, a good score is anything higher than 720, while anything from about 620 to 720 is usually high enough to obtain a loan. If your score is below 620, lenders will consider you a subprime borrower -- your credit is below average -- according to Bankrate, while a score of 500 to 520 is the absolute lowest you can have and still possibly qualify for a mortgage.


Your 580 score will be a serious hindrance to your chances of obtaining a mortgage, but using a co-signer can help you overcome this hurdle. When someone co-signs your loan application, that person agrees to be legally responsible for making your loan payments if you are unable to do so. However, if you use a co-signer it's important that that co-signer has a much higher credit score than you do. If the co-signer has a similarly low credit score, this will do almost nothing to improve your chances.

FHA Loans

If your credit score is 580 or lower you may be able to obtain a loan through the Federal Housing Authority loan program. The FHA provides loans to people with credit scores as low as 500. However, your chances of obtaining a mortgage with such a low score even through the FHA are still slim.


About the Author

Roger Thorne is an attorney who began freelance writing in 2003. He has written for publications ranging from "MotorHome" magazine to "Cruising World." Thorne specializes in writing for law firms, Web sites, and professionals. He has a Juris Doctor from the University of Kansas.

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