The Federal Housing Finance Agency (FHFA) directed Fannie Mae and Freddie Mac on Thursday to require disclosure of a VantageScore 4.0 credit score on every mortgage they securitize, the latest step in a rapid overhaul of how U.S. home loans are underwritten after decades of near-exclusive reliance on Classic FICO models. For borrowers, it means lenders selling loans to those government-sponsored enterprises (GSEs) can now use a newer score that often runs a bit higher and can count on-time rent, rather than only the old FICO snapshot.
“Since 2020, FICO has increased the price per a person’s credit score by 1,800%. FICO has enjoyed a monopoly. No more,” FHFA Director Bill Pulte said in an earlier social media post. “Fannie and Freddie’s initial rollout of VantageScore has been incredibly successful, with 50 LENDERS DELIVERING LOANS. So, EFFECTIVE IMMEDIATELY, I’m instructing Fannie and Freddie to approve ALL lenders to use VantageScore.”
“Effective Today,” he posted on Wednesday, “in the interest of transparency, ALL Mortgage Backed Securities (MBS), ALL Credit Risk Transfers (CRT), and ANY Securitized Product issued by Fannie Mae and Freddie Mac will now carry a VantageScore, in addition to a FICO score. One company cannot hold the market hostage.”
The shift implements the Credit Score Competition Act of 2018, signed during President Donald Trump’s first term, which required FHFA to validate additional scoring models. In 2022 the agency approved VantageScore 4.0 and FICO Score 10T. Both use 24 months of trended data and, where reported, rent and other alternative payments that Classic FICO largely ignored.
A joint FHFA-HUD announcement on April 22 began the process. HUD Secretary Scott Turner said the Federal Housing Administration would accept VantageScore 4.0 and FICO 10T for FHA-insured loans. Fannie Mae and Freddie Mac immediately began taking VantageScore loans from a small group of approved lenders while keeping Classic FICO as an option. FICO 10T historical data was published July 1; live delivery of that model has not yet begun.
FHA implementation is expected in January 2027.
VantageScore is jointly owned by Equifax, Experian and TransUnion and says its model scores roughly 33 million more U.S. adults than Classic FICO or FICO 10T, including nearly 5 million it describes as mortgage-ready. The company and Equifax have cited potential industry savings approaching $1 billion a year. Equifax is offering VantageScore 4.0 to mortgage lenders at $1 through the end of 2027.
Major originators including Rocket Mortgage and United Wholesale Mortgage, along with the Federal Home Loan Banks and the Department of Veterans Affairs, had already moved to the newer model before the all-lender mandate. Adoption remains optional for GSE deliveries; lenders may still use Classic FICO, but a single loan must use one model throughout. Tri-merge credit reports from all three bureaus remain required.
Pulte has also said FHFA is “seriously considering” bi-merge — a credit reporting process that pulls credit data and scores from only two of the three major national credit bureaus — or even single-bureau reports, arguing the three national credit bureaus have overcharged consumers.
Fair Isaac (FICO) shares fell sharply after the September directive. A company spokesperson told HousingWire it supports competition, called FICO 10T “the most predictive credit score available today,” and said it expects 10T to be implemented.
The practical change for homebuyers is that lenders selling loans to the GSEs may now pick VantageScore 4.0 or Classic FICO for a given file. Researchers at the Urban Institute comparing the two models on years of GSE loans found VantageScore 4.0 ran about 14 points higher on average than Classic FICO on the same 300–850 scale. In a July 2026 follow-up, they estimated that if a lender simply reported the higher of the two scores, about 44 percent of borrowers would look better on paper and the average reported score would rise by roughly 11 points, with far fewer files landing below 640 and far more above 800.
– – –
Christina Botteri is the Executive Editor of The Tennessee Star and The Star News Network. Follow her on X at @christinakb.
