New credit score model to be accepted by the wider market.
Federal Housing Finance Agency (FHFA) Director Bill Pulte has directed Freddie Mac and Fannie Mae to accept VantageScore 4.0 credit scores.
Director Pulte stated, “Since 2020, FICO has increased the price per a person’s credit score by 1,800%. FICO has enjoyed a monopoly. No more. 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.”
Until September, VantageScore 4.0 had been used in over 9% of mortgages since the company’s launch in May of this year. Rocket Mortgage, the Federal Housing Administration (FHA), the Federal Home Loan Banks, and the Department of Veterans Affairs were early adopters. The company has been commended for leveraging higher amounts of information to reflect an individual’s mortgage readiness, 400 percent more data than traditional credit scoring systems, including rent and utility payment histories.
As the Lord Leads, Pray with Us…
- For Director Pulte as he continues to review and update procedures for individuals to apply and qualify for mortgages.
- For officials at Freddie Mac and Fannie Mae as they incorporate the new procedure for evaluating mortgage-worthiness.
Sources: MPA Magazine, Independent Journal Review
