Fannie Mae and Freddie Mac Expand VantageScore 4.0 Option to All Single-Family Lenders

The traditional mortgage industry operates on a strict premise, enforced by legacy underwriting systems: a borrower without a standard FICO score is inherently too risky to approve for a home loan. This week, the two institutions that back the majority of U.S. mortgages set that assumption aside, officially expanding an alternative scoring model that proves otherwise to 100 percent of their approved lenders.[1][3]

Fannie Mae and Freddie Mac, the government-sponsored enterprises (GSEs) that guarantee a massive share of the housing market, announced the expansion following a limited rollout earlier in 2026. Lenders nationwide can now deliver single-family loans underwritten with VantageScore 4.0, a model that incorporates trended data and non-traditional payment histories into its risk calculations.[3][4]

For a prospective buyer who has paid rent and utility bills on time for 24 consecutive months but lacks a robust history of credit card or auto loan debt, the shift is highly practical. Under the old framework, that buyer was effectively invisible to the automated underwriting systems. Now, their actual monthly payment habits count toward their borrowing power, bridging a gap that has historically locked out younger and minority buyers.[5]

The National Association of Realtors noted that the broader availability of the model is a critical step in addressing housing equity. "VantageScore 4.0 is now available to all GSE-approved single-family lenders," the organization stated, emphasizing that the updated model "can score approximately 33 million more consumers than traditional models."[5]

The transition is not mandatory yet, but major players are already moving to capture the expanded borrower pool. Housing Wire reported that wholesale lending giants like Rocket Pro TPO and United Wholesale Mortgage have dominated the early volume of VantageScore 4.0 loans during the initial pilot phases, signaling strong institutional appetite for the alternative metrics.[1]

America's Credit Unions highlighted that the shift provides lenders with more flexibility and precision in assessing risk. The trade group emphasized that the new model maintains the safety and soundness of the GSEs' portfolios while expanding the credit box for underserved communities, allowing credit unions to serve members who were previously sidelined by rigid scoring parameters.[2]

The mechanics of the rollout require lenders to update their loan origination systems to transmit the new score data from the 3 major credit bureaus. According to TENA Companies, a mortgage quality control firm, the GSEs have published updated technical specifications to ensure lenders can seamlessly integrate the VantageScore metrics into their daily underwriting workflows without disrupting compliance checks.[4]

While the option is now available industry-wide, the Federal Housing Finance Agency (FHFA) has mandated a full transition to a bi-merge credit reporting system and the mandatory use of both VantageScore 4.0 and FICO 10T by the end of 2025. Until that deadline arrives, lenders have the discretion to adopt the new standard at their own pace, testing the waters with a new generation of homebuyers.[1][3]