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Fannie & Freddie Just Blew the Doors Open on Credit-Scoring—Here’s What Brokers Need to Know

America’s mortgage gatekeepers, Fannie Mae and Freddie Mac, will now let lenders underwrite loans using VantageScore 4.0 (and its cousin, FICO 10T) instead of— or in addition to—the decades-old Classic FICO model. 


Photorealistic CGI scene of two first-time homebuyers celebrating with their real-estate agent in front of a cozy starter home set atop a glowing green credit-score dial, while holographic icons of rent and utility bills turn into check marks—illustrating how VantageScore 4.0 and FICO 10T help more renters qualify for mortgages.

FHFA director Bill Pulte announced the change on July 8, 2025, calling it “effective immediately.” Why the buzz? VantageScore 4.0 and FICO 10T both count on-time rent, utility and telecom payments—data that Classic FICO ignores. That single tweak could pull millions of “credit-invisible” renters into the home-buying conversation, particularly first-generation, minority and gig-economy buyers.


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Five Talking Points for Your Next Buyer Consultation

What to Explain

Why It Matters

1. Two scores may be better than one. Lenders can now choose VantageScore 4.0, FICO 10T or Classic FICO when they sell a loan to the GSEs.

A client whose Classic FICO stalls at 615 might break 640—or higher—once rent and utilities are scored, potentially qualifying for a better rate or even basic approval.

2. Alternative data only helps if it’s reported. Encourage renters to use rent-reporting services (e.g., Experian Boost, Rental Kharma) so each on-time payment gets captured.

Without verified data in the bureaus’ files, the new models have nothing new to score.

3. Timelines are fluid. FHFA says the full transition is a “multiyear effort,” and many lenders are still tweaking underwriting software.

Pre-qual letters issued this summer might still rely on Classic FICO. Set expectations early.

4. Not every loan accepts the new models (yet). FHA, VA and USDA still default to Classic FICO until their own rulebooks change.

Steer credit-thin buyers toward conventional products or specialty programs where the lender can use VantageScore 4.0/FICO 10T.

5. Good habits still rule. High credit-card balances or late payments will sink every model.

Emphasize fundamentals: low utilization, no late pays, and time.


Action Plan: Partner With Your Mortgage Pros

  1. Inventory lenders. Ask each preferred mortgage broker which investors or aggregators are already pricing files with VantageScore 4.0 or FICO 10T.

  2. Map loan types. Conventional conforming loans are the first wave; specialty products will follow. Keep a running cheat-sheet for your team.

  3. Pre-screen credit-thin leads. Run a soft-pull VantageScore for renters ahead of house-hunting to uncover hidden eligibility.

  4. Educate buyers. Include a one-page explainer in your buyer packets: “How Paying Rent on Time Can Boost Your Mortgage Score.”

  5. Track implementation dates. The GSEs will roll out bi-merge reports (two bureaus instead of three) and other tech updates.


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How This Helps More People Buy Homes

  • Credit invisibility shrinks. Roughly 45 million U.S. adults lack a conventional credit score. Adding rent, phone and power bills can instantly populate a score for many of them.

  • Score “lift” is real. VantageScore says 10–20 points of upward movement is common once alternative data flows in—often the difference between approval and denial.

  • Equity boost. Communities of color are more likely to be credit-thin; modern scoring is a step toward closing the home-ownership gap, a long-time NAR advocacy priority.


Bottom Line for Brokers

The credit-score overhaul isn’t a someday headline—it’s live policy. Start coaching clients today:

  • Verify their rent is being reported.

  • Keep utilities in their own name and pay on time.

  • Re-pre-qualify buyers whose files were rejected under Classic FICO.


And keep your mortgage partners close; they’ll be the first to know which investors are ready to buy loans scored the modern way. When they are, you’ll have a pipeline of newly qualified buyers ready to move.


Do you think that using the Vantage score will benefit prospective home buyers? Let us know in the comments below or share with a colleague in an upcoming CE Class!



References

Consumer Financial Protection Bureau. Who Are the Credit Invisibles? Policy report, Dec. 2016. PDF. Accessed 5 Aug. 2025.

Federal Housing Finance Agency. “Credit Scores.” Last updated 15 July 2025. Accessed 5 Aug. 2025.

Griffith, Keith. “Paying Rent on Time Could Now Help You Get a Mortgage After Key Change at Fannie and Freddie.” 8 July 2025. Accessed 5 Aug. 2025.

VantageScore Solutions, LLC. “VantageScore 4.0 Allowed for Use on All Fannie Mae and Freddie Mac Mortgages Effective Immediately.” Press release, 8 July 2025. Accessed 5 Aug. 2025.

“VantageScore Officially Enters the Mortgage Market, a Win for Consumers.” 28 July 2025. Accessed 5 Aug. 2025.

 
 
 
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