When assessing your application, lenders consider several factors, such as your income, savings, employment, age, and credit history. Your credit score also plays a major role in this. It helps determine the interest rate on your loan, as well as the required deposit.

When you apply for a home loan, understanding your credit score can help you compare lenders' eligibility criteria, rates and fees, and consider independent financial advice if needed. If you have a lower credit score, you shouldn’t be disheartened as there are opportunities for every credit score range.

In this article, we find out what your chances are of being approved for a home loan, and we outline some tips and tricks to help you secure your dream home.

What’s the lowest credit score that’s accepted for a home loan?

In South Africa, lenders have different standards when it comes to credit scores. This means that there isn’t a minimum credit score required to get a home loan.

The majority of lenders in South Africa don’t make their credit criteria public and they use different calculations to determine loan eligibility.

Credit bureaus, nonetheless, have benchmarks that can be used as a guide for individuals. They can check their credit scores and find out whether they have a decent chance of loan approval.

You can use the following brackets from Experian as a benchmark:

Certain lenders consider below-average credit scores unfavourable. However, smaller lenders may still be willing to provide you with the support you need. Even a reasonably lower credit score may still lead to an offer - though it is likely to come at an additional cost.

Know where you stand for your home loan application? Login to ClearScore to view your free credit score and report. You can then return to this article and find out under which bracket you fall.

What your credit score actually costs you: deposit, rate and repayment by score band

Your credit score doesn't just decide whether you're approved for a home loan - it decides what that home loan costs you every month for the next 20 years. South African banks use risk-based pricing, which means the rate you're quoted is set against the prime lending rate depending on how risky your credit profile looks. A strong score can earn you a rate below prime; a weak one can push you well above it.

The table below models the same property for every score band so you can see the difference. The assumptions are: a R1.2 million property, a 20-year repayment term, and a prime lending rate of 10.75%. Rates are illustrative only and exclude initiation and monthly service fees; repayments reflect different loan amounts after each deposit, and your actual offer depends on each lender's own affordability assessment.

Why lenders price risk this way

Under the National Credit Act, lenders must lend responsibly and cannot extend credit to someone who is unlikely to repay it. Beyond that legal duty, a bank's pricing simply reflects the probability of default. A lower credit score signals a higher chance that the loan will go bad, so the bank protects itself in two ways: it charges more interest, and it asks for a larger deposit to bring the loan-to-value ratio down. A 20% deposit means the bank is only exposed to 80% of the property's value, so even in a forced sale it is far more likely to recover its money.

What the rate gap is really worth

On a R1.2 million property, the difference between borrowing at prime −0.5% with no deposit and borrowing at prime +3% with a 20% deposit is roughly R200,000 in interest across the life of the bond - and that's before you account for the R240,000 you had to find upfront. Put differently, improving your score by one or two bands before you apply is often worth more than any amount of haggling over the purchase price.

Treat these figures as a guide to the shape of the trade-off rather than a quote. Prime moves with the Reserve Bank's repo rate, and each lender applies its own scorecard, so two people with identical scores can receive different offers from the same bank.

What is the average credit score for a home loan?

Lenders would be thrilled if everyone had a credit score of 658 and above. However, if your score is 634 or higher, lenders may see you as lower risk - though approval always depends on each lender’s own checks, including affordability.

If your credit score is lower than this, you can still apply for a home loan. But if you’re not in a rush to buy the property you’ve been eyeing, it may be worthwhile to work on your credit score before you make your home loan application.

Join one of ClearScore's free coaching plans and set aside the next 6 to 12 months to improve your credit score. In the end, you may save thousands of rands by securing a lower interest rate.

Can I qualify for a home loan with bad credit?

A below-average credit score falls in the Let’s start climbing band (0-598) on the ClearScore scale. Those in this bracket are on the lower end of the credit-active population and lenders will view them as unpredictable.

If you have a bad credit score, you should be mindful that bigger lenders are unlikely to consider your application due to the uncertain nature of your financial history. But just because it’s difficult to reach does not mean it’s impossible.

If this includes you, it’s important to realise that there are ways you can still improve your credit score - so don’t be discouraged. The most effective way to build your credit score is by joining a free, self-paced coaching plan, such as “Build your credit” or “Buying your first home”.

How long does it take to improve your credit score before applying for a home loan?

For most South Africans, meaningful credit score improvement takes between three and twelve months, depending on what's dragging the score down. Correcting an error can move your score within weeks; rebuilding after a default or judgment takes considerably longer. Here's a realistic timeline of what actually shifts, and when.

Can you really raise your credit score in 30 days?

Partly, and only in specific circumstances. A 30-day jump to 700 is not something you can engineer through good behaviour alone - payment history builds slowly by design. What can move quickly is the correction of something that shouldn't be on your report in the first place, or a sharp reduction in how much of your available credit you're using. Be sceptical of any service promising a fixed number of points in a fixed number of days.

What can change within 30 days

• Disputing errors on your credit report: Bureaus are obliged to investigate disputes, and an incorrect default or account that isn't yours can come off within about 20 business days, often lifting your score immediately.

• Clearing a judgment or paid-up adverse listing: Once a judgment is rescinded or a default settled and confirmed, the listing status updates and the drag on your score eases.

• Lowering your credit utilisation: Paying credit cards and store accounts down below roughly 30% of their limits before the bureau's next reporting date can produce a visible improvement in a single cycle.

What changes over three to six months

• Consistent on-time payments: Three to six months of unbroken punctual payments across every account starts to outweigh older blemishes.

• Keeping revolving balances low: Sustained low utilisation counts for more than a one-off payment before month-end.

• Avoiding new credit applications: Each application leaves an enquiry. Letting those age without adding more steadies the score.

What takes twelve months or longer

• Recovering from defaults and adverse listings: These stay on your report for one to two years even after settlement, and the score only recovers as they age.

• Rebuilding after debt review: A clearance certificate must be issued and the bureaus updated before your profile normalises.

• Building a thin file: If you have almost no credit history, you need twelve months or more of active, well-managed accounts before lenders have enough to score.

How long from 500 to a home-loan-ready 634?

Going from around 500 to the 634-plus range where the major banks will comfortably consider you typically takes twelve to eighteen months of disciplined behaviour, assuming no new adverse listings appear along the way. If your low score comes from a single recent missed payment rather than a pattern of defaults, six to nine months may be enough. If it comes from judgments or debt review, plan for two years.

Bureau reporting cycles delay what you see

Credit providers report to the bureaus monthly, not instantly. If you settle an account today, that change may not reach your credit report for four to six weeks. Build that lag into your planning - the improvement you made in March is what a lender sees in May.

The pre-application quiet period

Stop applying for new credit three to six months before you submit your bond application. Each application records an enquiry, and a cluster of recent enquiries reads to a bank as financial pressure. No new store cards, no vehicle finance, no personal loans - just steady repayment of what you already have. To structure that run-up, join one of ClearScore's free coaching plans and work through it month by month.

What is the minimum salary to get a home loan?

The salary required for a home loan depends on the size of the loan. For example, you would need a larger income for a R5 million property than you would for a R1 million property.

Lenders are legally required to extend loans responsibly. This means that it’s illegal to lend money if the applicant won’t be able to pay back the loan. But each lender assesses these criteria differently, as small overdue payments may hold less weight than larger ones.

They will consider whether you have enough disposable income left at the end of each month to meet your monthly home loan repayments. You can easily work this out by using our free affordability calculator.

If lenders determine that you don’t have a large enough income to successfully repay the loan within the repayment period, they will not be able to approve your loan.

Before you apply for a home loan, see if you can find ways to increase your after-costs income. Perhaps you can monetize one of your hobbies or maybe you can take on some freelance work. If you can prove that your extra income is sustainable, you will increase your chances of loan approval.

Learn:6 things you need to know before applying for your first home loan

How South African banks assess your home loan application (and why your score isn't the whole story)

Your credit score is one input into a bond decision, not the decision itself. South African banks run an affordability assessment, examine the property, read your credit report in detail, and weigh your employment profile. Two applicants with identical scores routinely get different outcomes because of what sits around the number.

The affordability assessment

Banks start with your gross monthly income, deduct tax, then deduct your existing debt commitments and living expenses to arrive at net disposable income. Most lenders want your total debt repayments - including the new bond - to stay at or below roughly 30% to 35% of gross income. If you earn R40,000 a month and already pay R6,000 towards a car and credit cards, the room left for a bond instalment is materially smaller than it looks on paper. Bank statements are scrutinised, so unexplained transfers, gambling activity or regular unarranged overdraft use will count against you.

Loan-to-value and 100% bonds

Loan-to-value is the bond amount as a percentage of the property's value. A 100% bond - no deposit - is genuinely available in South Africa, particularly to first-time buyers with clean credit profiles and stable salaried income. But the lower your score, the less willing a bank is to carry full exposure, and the more likely it is to require 10% or 20% down. A deposit is also the fastest lever you have for negotiating a better rate when your score is mid-range.

Bond pre-approval

A pre-approval tells you what you can realistically borrow before you start viewing properties, and it makes your offer more credible to a seller. Most banks and originators offer it free. It is generally based on a soft assessment of your affordability and credit profile, so it does not damage your score in the way a string of full applications would - but confirm this with the provider before proceeding, and don't treat a pre-approval as a guarantee, because the formal application still verifies everything.

Bond originators and multiple applications

A bond originator submits one application on your behalf to several banks at once, then brings back competing offers. This matters for two reasons. First, it lets you compare rates rather than accepting the first offer, which is where the real saving sits. Second, it avoids you personally lodging separate applications at four banks over several weeks, which stacks enquiries on your credit report and signals desperation. Originators are paid by the bank, not by you.

How your credit report is read beyond the number

Assessors look at the detail behind the score. Recency matters enormously - a missed payment three months ago is treated far more seriously than one three years ago. Adverse listings, judgments and any current or past debt review status are flagged directly. So is the pattern: one late payment reads as an oversight, six reads as a habit. Reviewing your own report before you apply, and clearing up anything inaccurate, removes surprises from the process.

Self-employed and commission-based applicants

If you're self-employed, a freelancer, or earn largely on commission, expect to supply more: typically six months of personal and business bank statements, two years of audited or accountant-signed financials, up-to-date tax returns and a SARS tax clearance. Banks average irregular income over a period, so a strong recent quarter won't carry a weak year. Keeping business and personal accounts cleanly separated makes this assessment considerably easier.

FLISP and first-home-buyer support

If your household earns between roughly R3,501 and R22,000 a month, you may qualify for the First Home Finance subsidy (formerly FLISP), a once-off government grant that can be applied to your deposit or to reducing your bond amount. You must be a first-time buyer, a South African citizen or permanent resident, and you must already have bond approval in principle. It won't fix a lower credit score, but it can close the deposit gap that a mid-range score creates. For more on preparing your application, read 6 things you need to know before applying for your first home loan.

How to make your home loan application easier

Having a bad credit score doesn’t mean that you will never qualify for a home loan. If the minimum criterion for a home loan is not met, there are ways to improve your credit score over time.

Here are the top strategies you should consider:

• Manage a financial plan with savings: It’s important to organise your regular expenses and establish a budget so that your bills don’t pile up and become overwhelming.

• Pay your bills on time: Making consistent, punctual payments can help build your credit score over time. This is because positive credit behaviour is also listed on your credit report.

• Use automatic payment methods: You can set up debit orders to settle smaller bills. This is a great way to ensure you develop a positive payment history.

• Settle your outstanding debt: It may be helpful to show that you’re able to pay off outstanding debt, and it may also improve your credit score.

• Choose the right lender: Denied credit applications also appear on your credit report. Pick the right lender for your circumstances so that you don’t have to repeatedly apply for credit.

• Team up with your partner: If you apply for credit with another person, make sure you both work on your credit scores before applying. Applying together once you have both worked on your scores may strengthen your home loan application.

The first step to improving your credit score is to know and understand it. Sign up with ClearScore and get lifetime access to your credit score and report.

Home loan credit score FAQs

Is 620 a lower credit score in South Africa?

A score of 620 sits in the 616-633 range on the Experian scale (0-740) - around the average range rather than poor. You are unlikely to be turned away outright, but you should expect a higher interest rate and a request for a deposit of around 10% to 15%. Lifting the score above 634 before you apply may improve the terms you're offered, though each lender decides on its own checks.

Which credit bureau do South African banks use, and does my ClearScore score match what they see?

South African lenders draw reports from several registered bureaus, most commonly TransUnion, Experian, XDS and Compuscan. Each bureau holds slightly different data and uses its own scoring model, so the number a bank sees may not be identical to the one you see. Your ClearScore score reflects the bureau data ClearScore accesses and is an accurate guide to your standing and direction of travel - but treat any single score as an indicator of your band rather than the exact figure a bank will quote from.

What is the biggest killer of credit scores before a home loan application?

Missed and late payments, by a clear margin. Payment history carries the heaviest weighting in almost every scoring model, and a recent missed payment does more damage than an old one. The next biggest offenders are high credit utilisation - running store and credit card accounts near their limits - and a burst of new credit applications in the months before you apply.

Can errors on my credit report be reversed, and how long does a dispute take?

Yes. Under the National Credit Act you have the right to dispute any information on your report free of charge. The bureau must investigate and respond, generally within about 20 business days, and if the credit provider cannot substantiate the entry it must be removed or corrected. Keep proof of payment or correspondence to support your case.

Does applying to several banks for a home loan damage my credit score?

Multiple full applications spread over weeks will each leave an enquiry and can weigh on your score. The safer route is a bond originator, which submits a single application to several banks simultaneously so you get competing offers without stacking repeated enquiries across months.

Can I get a home loan while under debt review or with a judgment listed?

Not while you are actively under debt review - you cannot take on new credit until you've completed the process and received a clearance certificate. A judgment does not make a bond legally impossible, but mainstream banks will almost certainly decline. Settle and rescind the judgment, allow the listing to age, and rebuild before applying.

Does my partner's bad credit score affect a joint home loan application?

Yes. In a joint application, both credit profiles are assessed and the weaker one typically drives the pricing. The advantage is that both incomes count towards affordability, which can unlock a larger bond. If one partner's score is considerably weaker, it's worth comparing a joint application against a single application in the stronger name.

Will settling an old debt remove it from my credit report?

No. Settling updates the account status to paid or settled, which lenders view far more favourably, but the record of the default remains for a period - typically one to two years depending on the listing type. The score recovers gradually as the entry ages, which is why settling early rather than just before you apply matters. Check your standing with ClearScore to see exactly what's listed against you.