Fannie Mae, Freddie Mac to accept rent and utility-based credit scores

Renters who have paid on time but never built thick traditional credit files are the biggest beneficiaries of a change federal housing officials unveiled on April 22. Fannie Mae and Freddie Mac will begin accepting VantageScore 4.0 for mortgage underwriting, a model that incorporates rent and utility-payment history, while also moving toward a modified FICO Score 10T system.

The Federal Housing Finance Agency said the shift is meant to widen access to mortgages and modernize the way lenders judge creditworthiness. William J. Pulte said the change is being folded into the agencies’ guarantee process, and the goal is to help borrowers who have shown they can manage monthly obligations without always being rewarded by older scoring formulas. Scott Turner said the Department of Housing and Urban Development would consider the scores for FHA loans, extending the policy beyond the government-sponsored enterprises.

The move carries outsized weight because Fannie Mae and Freddie Mac back most U.S. mortgages. Even a technical change in score acceptance can affect millions of potential buyers, especially first-time borrowers and households with thin credit files. FHFA said VantageScore 4.0 and FICO 10T were validated in October 2022, and it released historical VantageScore 4.0 scores in July 2024 tied to loans acquired beginning in April 2013 to help with implementation. On April 22, Fannie Mae said its Selling Guide would be updated to allow VantageScore 4.0 immediately and later permit FICO Score 10T, while Freddie Mac said it was moving in the same direction.

Housing groups broadly welcomed the decision. The National Association of Realtors said counting timely rent, utility and telecom payments would make underwriting more accurate and equitable, and the Mortgage Bankers Association also supported the move while warning that operational questions remain around pricing grids, minimum score eligibility and business rules. VantageScore has argued that its model captures payment behavior from sources such as rent, utilities and cell-phone bills, which can make more renters mortgage-eligible.

The timing matters. Existing-home sales fell 3.6% in March to a seasonally adjusted annual rate of 3.98 million, while the median existing-home price rose 1.4% from a year earlier to $408,800, according to the National Association of Realtors. Lawrence Yun said inventory remained a major constraint, estimating that 300,000 to 500,000 additional homes for sale would help normalize the market. Against that backdrop, even a modest expansion in mortgage access could reshape who gets through the front door of homeownership.