Predictive Credit Scores
- Fannie Mae and Freddie Mac will accept 'predictive' credit scores that include rent and utility payments in assessments. - The policy change allows mortgage underwriters to use alternative payment history for applicants with thin credit files. - This expands mortgage access criteria for thin-file borrowers but does not change current mortgage-rate dynamics (reuters.com).
Fannie Mae and Freddie Mac are starting to accept mortgage credit scores that count rent payments, ending the long run of using only Classic FICO. (fhfa.gov) The Federal Housing Finance Agency said on April 22 that approved lenders can now sell loans to the two companies using either Classic FICO or VantageScore 4.0 in an interim phase. FHFA said VantageScore 4.0 is available now, while FICO Score 10T will come later. (fhfa.gov) A credit score is a lender’s shortcut for judging whether a borrower is likely to repay. FHFA said the newer models use added data, including rent payment history, and are “more predictive” of default risk than the older mortgage standard. (fhfa.gov) That matters most for borrowers with “thin” credit files — people who pay rent, utilities, or other recurring bills on time but have little traditional borrowing history on credit cards or loans. Reuters reported that officials pitched the change as a way to widen access to affordable mortgages. (finance.yahoo.com) The shift is narrow, not universal. Fannie Mae said the change is effective immediately but only through a limited lender rollout, and lenders outside that group must keep using Classic FICO scores from all three credit bureaus for now. (singlefamily.fanniemae.com) The policy is also part of a longer federal rewrite of mortgage credit scoring. FHFA said Congress set that process in motion in 2018, and the agency validated VantageScore 4.0 and FICO 10T in 2022 after testing by Fannie Mae and Freddie Mac. (fhfa.gov) Fannie Mae said it will publish more historical score data in summer 2026, including FICO 10T data for loans acquired from April 2013 through September 2025 and more VantageScore 4.0 data from April 2023 through September 2025. The company said that is meant to help lenders and investors compare how the newer models would have performed. (singlefamily.fanniemae.com) Reuters also reported that Housing and Urban Development Secretary Scott Turner said the Federal Housing Administration would consider the same newer scores for government-backed loans. That would extend the push beyond the two mortgage giants that back most U.S. home loans. (finance.yahoo.com) What the announcement does not change is the cost of borrowing in today’s market. It changes who can be scored for a mortgage more easily, not the mortgage-rate backdrop facing buyers in April 2026. (finance.yahoo.com)
