Federal Housing Finance Agency (FHFA) Director Bill Pulte has directed the government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, to accept VantageScore 4.0 credit scores from all mortgage origination lenders, effective immediately.

The decision is significant because Fannie Mae and Freddie Mac guarantee or securitize a large share of U.S. home mortgages, and the GSEs' credit score requirements have historically shaped which scoring models lenders use across the market. Since the GSEs were placed under FHFA conservatorship in 2008, the agency has served as their regulator and must approve changes to their underwriting standards.

Described as the most advanced credit score available for mortgage origination, VantageScore 4.0 uses 400% more data to generate a credit score than legacy credit scores, providing a more predictive view of borrower creditworthiness and supporting lender growth. The model is a joint venture originally developed by the three major credit bureaus—Equifax, Experian, and TransUnion—as an alternative to FICO's long-dominant scoring models. Beyond Fannie Mae and Freddie Mac, many of the largest mortgage lenders and industry participants have already adopted VantageScore 4.0 for mortgages, including Rocket Mortgage, the Federal Housing Administration, the Federal Home Loan Banks, and the U.S. Department of Veterans Affairs.

As of August 31, 2026, VantageScore 4.0 had been the sole credit score used for over 9% of all mortgages securitized by Fannie Mae and Freddie Mac since May 1, 2026.

"The extraordinary pace of VantageScore 4.0 adoption signals a new era for the mortgage industry," said Silvio Tavares, President and CEO of VantageScore. "Lenders are rapidly embracing a more modern and predictive credit score that lowers risks, reduces costs and identifies millions more creditworthy borrowers."

Responsible expansion of the mortgage market through more qualified borrowers

VantageScore 4.0 scores approximately 33 million more U.S. adults than FICO Classic or FICO 10T, including nearly 5 million additional mortgage-ready consumers. Among these are approximately 24 million dormant-file consumers, 77% of whom score Near Prime or Prime, revealing a significant population of experienced borrowers overlooked by legacy scoring models. For lenders and housing policymakers who have focused on tight credit availability since the 2008 financial crisis, the ability to score consumers with thin or dormant credit files expands the addressable borrower pool without changing underwriting standards.

Greater predictive power through 400% more data

VantageScore 4.0 was the first and only tri-bureau credit scoring model to utilize trended credit data. Trended data captures how balances and payments change over time rather than relying on a single-point snapshot, which is the approach of legacy models. By leveraging large data sets, VantageScore uses 400% more data to generate a credit score than legacy mortgage credit scores, giving lenders a deeper view of consumer behavior.

Nearly $1 billion in annual cost savings

A recent independent study by Deep Future Analytics shows that the FHFA's approval of VantageScore 4.0 for Fannie Mae and Freddie Mac mortgages saves over $930 million in the first year.

With FHFA approval now extended to all lenders originating GSE mortgages, a key open question for the industry is how quickly the remaining share of Fannie Mae and Freddie Mac securitizations transitions to the newer model, and how competing scoring providers respond.

Source: GlobalFinTechSeries