HousingWire Daily James Kleimann on the VantageScore announcement
Jul 10, 2025
James Kleimann, Managing Editor at HousingWire, dives into the recent acceptance of VantageScore 4.0 by Fannie Mae and Freddie Mac. He discusses the challenges of implementing this new credit scoring model, including industry readiness and the need for modern alternatives. Kleimann highlights the importance of inclusivity in credit scoring, examining how VantageScore can benefit those with limited credit histories. Additionally, he touches on the outdated practices of reporting rent payments and the compliance changes that could reshape accessibility to credit in the mortgage sector.
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Immediate VantageScore 4.0 Acceptance
- FHFA Director Bill Pulte announced immediate acceptance of VantageScore 4.0 by Fannie Mae and Freddie Mac.
- Despite the announcement, lenders and stakeholders are not ready to implement it currently.
Limited Competition in Credit Scores
- VantageScore 4.0 brings competition to the credit scoring market, ending FICO's monopoly.
- However, the credit bureaus also own VantageScore, so true competition and cost savings may be limited.
No Immediate Cost Savings Expected
- The switch to VantageScore 4.0 does not change the tri-merge credit report process used by mortgage lenders.
- This means immediate cost savings for borrowers from fewer reports are unlikely under the new model.