FHFA Credit Score Transition: FICO 10T and VantageScore 4.0

The FHFA credit score transition is the ongoing switch, ordered by the Federal Housing Finance Agency, from the decades-old Classic FICO model to two newer models — FICO 10T and VantageScore 4.0 — for conventional mortgages sold to Fannie Mae and Freddie Mac. FHFA validated and approved both new models on October 24, 2022, but the rollout has run behind schedule. As of 2026, the transition sits in an interim phase: approved lenders may use either Classic FICO or VantageScore 4.0 on a loan-by-loan basis, and FICO 10T is approved but not yet available for loan delivery.¹

One boundary to set at the start: this only affects conventional conforming loans purchased by Fannie Mae and Freddie Mac. FHA, VA, and USDA loans follow their own credit score rules set by those agencies.

Where the Transition Stands in 2026

The original plan called for full implementation by the fourth quarter of 2025. In January 2025, that deadline was pushed to a date to be determined, and the transition remains incomplete.²

Three models are approved going forward: Classic FICO, VantageScore 4.0, and FICO Score 10T.³ Here is the practical status of each:

VantageScore 4.0 is available now, but only to lenders who have applied through Fannie Mae or Freddie Mac and been approved to deliver loans scored with it. Lenders who haven’t been approved must continue using Classic FICO.¹
Classic FICO is still fully accepted and remains the default for lenders not yet approved for VantageScore 4.0.¹
FICO 10T was validated in 2022 but is not yet available for loan delivery. The Enterprises plan to publish historical FICO 10T data and adopt the model at a later, unspecified date.¹

During this interim phase, only one model can be used per loan. A lender picks Classic FICO or VantageScore 4.0 for each individual loan it delivers, and the Enterprises will not accept scores from multiple models on the same file.¹ Borrowers don’t get to choose. Your lender does. And no retirement date has been set for Classic FICO.

What the New Models Actually Measure

Classic FICO looks at your credit report on the day it’s pulled: current balances, credit limits, whether accounts are current or past due. It’s a snapshot. FICO 10T and VantageScore 4.0 both use trended credit data, meaning they analyze roughly 24 months of monthly data to see the direction your finances are heading.⁴

Consider two borrowers who each carry a $5,000 credit card balance. One pays $1,000 every month and is steadily eliminating the debt. The other pays only the minimum and the balance barely moves. Under Classic FICO, they look essentially the same on the day the report is pulled. Trended data models recognize the first borrower as lower risk because the trajectory points toward zero.⁴

The models also separate borrowers who pay credit card balances in full each month from those who carry interest-bearing debt month after month, even when both groups show similar utilization ratios on the reporting date. For installment loans, they analyze the slope of your remaining balance and whether your actual payments meet, exceed, or fall short of the scheduled amount.⁴ Both models were selected because they outperformed Classic FICO in predicting mortgage defaults during FHFA’s validation process.¹

What VantageScore 4.0 Adds for Renters and Thin-File Borrowers

VantageScore 4.0 is the first tri-bureau credit score to incorporate rental payment data. Historically, rent showed up on credit reports only when it went bad and hit collections. Positive on-time rent almost never got reported, and only about 13% of renters currently have that positive history in their credit files.⁵

When on-time rent is included, VantageScore estimates nearly four million renters could reach a credit score of at least 620, the minimum for most conventional mortgage programs.⁵ At Fannie Mae, 620 is the floor for manually underwritten fixed-rate loans, and 640 is the floor for adjustable-rate mortgages.⁶ VantageScore’s analysis found renters who reach 620 through positive rental data default at rates comparable to borrowers who reach 620 without it.

Beyond renters, VantageScore 4.0 can score approximately 37 million more consumers than legacy models, mostly people with thin credit files that older models couldn’t score at all.⁷

The Planned Shift From Tri-Merge to Bi-Merge Reports

Alongside the scoring model changes, FHFA announced in October 2022 that the Enterprises would allow bi-merge credit reports, pulling data from two of the three national bureaus (Equifax, Experian, and TransUnion) instead of all three.⁸ The goal is lower closing costs, a simpler application, and more competition among the bureaus.

Bi-merge has not taken effect yet. As of July 2025, Freddie Mac confirmed lenders could use VantageScore 4.0 or Classic FICO under the tri-merge credit report requirement, meaning tri-merge remains the standard.⁹ The bi-merge option was part of the same timeline pushed to a to-be-determined date in January 2025.

When bi-merge does arrive, expect one important mechanical change. Under current Fannie Mae rules, when only two credit scores are available for a borrower, the lender uses the lower of the two as the representative score.¹⁰ That’s more conservative than the tri-merge approach, where the middle of three scores qualifies. Under bi-merge, a single low bureau score has more power to drag your qualifying number down than it does today.

How This Affects Mortgage Pricing

Credit scores drive the Loan Level Price Adjustments (LLPAs) that Fannie Mae and Freddie Mac charge on every loan they buy. LLPAs are risk-based surcharges tied to credit score, loan-to-value, and loan type. A lower score means a higher LLPA, which comes back to you as either a higher interest rate or more cash at closing.

Lender choice between two scoring models introduces a wrinkle. Because different models can produce different scores for the same borrower, lenders may lean toward whichever model produces the higher score on a given loan, which reduces LLPA revenue for the Enterprises. Actuarial analysis suggests the Enterprises may need to raise LLPAs across the board to offset that selection effect, and the added complexity could push rates up by an eighth of a percentage point or more as the market adjusts.

The tier you land in still matters at the individual level. LLPA tiers jump by fractions of a point at each threshold, and the gap between, say, 739 and 740 can mean hundreds of dollars a year in interest over the life of the loan. If you’re close to a tier boundary, the model your lender picks could move you across it in either direction.

What to Do Before You Apply

Trended data rewards behavior that Classic FICO largely ignored. If you’re planning to buy in the next year or two, a few habits carry real weight.

Pay more than the minimum, consistently. The models track your payment amount against what’s due. Paying above the scheduled amount on installment loans, or above the minimum on credit cards, scores better than paying exactly what’s owed, even when both accounts stay current.⁴
Bring balances down steadily rather than all at once. A clear downward slope across months is what trended models look for. A one-shot payoff right before you apply is less powerful than a visible 12- to 24-month pattern of declining balances.
Get your rent payments reported. If your lender uses VantageScore 4.0, positive rent history can lift your score. Several third-party services report rent to the bureaus for a small monthly fee, and most renters currently have no rental data in their files.⁵
Ask your lender which scoring model they use. Not every lender has been approved for VantageScore 4.0. If you’d likely score better under it (a thin file, on-time rent, a steady payoff trajectory), shop lenders who have adopted it.

The 24-month lookback in these models means the sooner you start building a positive trajectory, the more of it will be visible when your credit is pulled. Waiting until a few months before application leaves less runway for the trend to register.

1
Federal Housing Finance Agency. Credit Scores
2
Fannie Mae Single Family. Credit Score Models and Reports Initiative
3
Fannie Mae Single Family. Announcement SEL-2026-04
4
Federal Reserve Bank of Philadelphia. Trended Credit Data Attributes in VantageScore 4.0
5
VantageScore. New Analysis Finds Millions of Renters Become Mortgage-Eligible When On-Time Rent Payments Are Included in VantageScore 4.0 Credit Score
6
Fannie Mae. General Requirements for Credit Scores
7
VantageScore. Credit Invisibles Fact Sheet
8
Federal Housing Finance Agency. FHFA Announces Key Updates for Implementation of Enterprise Credit Score Requirements
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Freddie Mac. Credit Score Models and Reports Initiative
10
Fannie Mae. Determining the Credit Score for a Mortgage Loan