FHFA’s Credit Scoring & Pricing Shake-Up — What It Means for You

🏦 What’s Changing with Credit Scoring

The classic FICO model has been around longer than TikTok trends last, but that’s finally about to change. FHFA approved two new scoring models, FICO 10T and VantageScore 4.0, that bring modern data and analytics into play.

Here’s the short version:

• New models = new insights. Both models include trended data, meaning they look at how borrowers manage credit over time—not just a single moment.

• Expanded access. Rent and utility payment histories can now count, which is a big win for first-time and credit-thin borrowers.

• Dual-score delivery. Once implemented, lenders will need to deliver both FICO 10T and VantageScore 4.0 when available.

📅 Timeline: The GSEs aim to roll this out gradually through late 2025, with continued testing and calibration throughout 2026. The proposed “bi-merge” credit reporting (two instead of three bureaus) has not yet been implemented.

💰 LLPA (Pricing) Updates: Possible Relief Ahead

If you remember the LLPA overhaul in 2023, you know it sparked debate about fairness and borrower impact. FHFA later rescinded its proposed DTI-based fee, but conversations around targeted pricing relief haven’t gone away.

Industry chatter points to potential adjustments in:

• Second homes and cash-out refinances

• Risk-based pricing sensitivity

• Better balance between affordability and revenue stability

Nothing is finalized yet, but FHFA’s review could lead to incremental tweaks—not a full rewrite—over the next year.

🔍 What It Means for Borrowers and Agents

This is where things get interesting:

• Borrowers: These changes could improve access for renters and credit-builders who’ve been left out under traditional models.

• Agents: Expect to see more clients who qualify once rent and utility histories start counting.

• Lenders: AUS and pricing engine updates are coming—be ready for dual-model testing and new data fields.

Bottom line: the industry is preparing for smarter, fairer scoring. But for now, pricing still follows the existing LLPA grid

Curious how these updates could affect your next purchase or refinance? Let’s chat about how your credit, loan structure, and timing can play together for the best result.

📅 Schedule time with me here: 🔗 Jenn Patel | JPHomeLoans Calendar

🔗 Sources & References

1. FHFA – Validation of FICO 10T and VantageScore 4.0 for Use by Fannie Mae and Freddie Mac

2. Fannie Mae – Credit Score Models & Reports Initiative Overview

3. HousingWire – FHFA Reviews Loan-Level Price Adjustments

4. American Enterprise Institute – Estimating the Effect of a Two-Score System on Loan-Level Price Adjustments

5. FHFA – Setting the Record Straight on Mortgage Pricing (Director Sandra L. Thompson Statement)

6. Urban Institute – Considerations for Implementing New Credit Scores in Mortgage Lending