Best Mortgage Lenders That Accept a 500 Credit Score in 2025

Getting a mortgage with a 500 credit score might sound difficult, but in 2025, there are still lenders who are open to working with borrowers who have low credit. While conventional mortgage options are usually off the table, some lenders specialize in offering loans to those with poor credit — especially through government-backed programs like FHA loans.

In this blog, we'll share a list of mortgage lenders that may approve borrowers with a 500 credit score, explain what you can expect, and offer tips to improve your chances of getting approved.

Can You Get a Mortgage with a 500 Credit Score?

Yes, it's possible — but there are limitations. A credit score of at least 620 is required by the majority of traditional lenders. However, the Federal Housing Administration (FHA) allows applicants with scores as low as 500 to qualify for an FHA loan, as long as they can provide a down payment of at least 10%.

Other options may include non-qualified mortgage (non-QM) loans, which are designed for people who don’t meet the strict guidelines of traditional lenders. These loans consider alternative documentation and focus more on income and assets.

What to Look for in a Lender if You Have a 500 Credit Score

Not every lender is willing to take on the risk of working with low-credit borrowers. When searching for a mortgage lender, keep the following factors in mind:

• Candidates with a credit score of 500 are accepted.

• They offer FHA or non-QM loan programs

• They provide manual underwriting options

• They clearly explain fees and loan terms

• They are experienced in working with bad-credit borrowers

Top Mortgage Lenders That Accept a 500 Credit Score in 2025

Here are some of the most recognized mortgage lenders in 2025 that accept borrowers with credit scores as low as 500.

Carrington Mortgage Services

Carrington is known for specializing in loans for borrowers with low credit scores. They offer FHA loans that start at 500 and often use manual underwriting, making them a good option if your credit history has a few challenges.

NewRez

NewRez offers FHA loans and is open to working with credit scores starting around 500. They also provide loan officers who guide you through the process and help with pre-qualification.

Angel Oak Mortgage

Angel Oak specializes in non-QM loans, which means they consider factors beyond just your credit score. These loans usually require a larger down payment, but they can be a great choice for self-employed borrowers or those with recent credit events.

Caliber Home Loans

Caliber offers a range of mortgage products, including FHA loans for low-credit borrowers. Their Fresh Start program is designed to help people rebuild credit and qualify for a mortgage.

Local Credit Unions or Regional Banks

Compared to national lenders, certain local banks could provide greater flexibility. If you have an existing relationship with a local credit union or regional bank, it’s worth asking about their mortgage options for lower credit scores.

Tips for Applying with a 500 Credit Score

Applying for a mortgage with a low credit score requires careful preparation. The following advice will help you increase your chances of being accepted:

• Save for a larger down payment (10% or more is ideal for FHA loans)

• As much as feasible, keep your debt-to-income ratio modest.

• Provide proof of stable and consistent income

• Avoid taking on new credit or loans before applying

• Get pre-qualified to understand your loan options and limits

Should You Wait or Apply Now?

When applying for a mortgage with a poor credit score, timing is crucial. Here’s how to decide:

Consider applying now if:

• You have a history of employment and a steady salary.

• You’ve found a lender who accepts low scores

• You expect interest rates or home prices to rise soon

Consider waiting if:

• In a few months, you can raise your score to 580 or above.

• More time is needed to save for a down payment.

• You want to lower your debt before applying

Conclusion

A 500 credit score doesn’t mean you can’t own a home. While your options are limited compared to borrowers with higher credit, several lenders still offer mortgage programs for people with lower scores. FHA loans and non-QM lenders provide pathways to homeownership, especially if you’re prepared with a solid financial plan and enough savings for a down payment.