Mortgage Processing Brief · Loandock · October 14, 2026
FHA is adding VantageScore 4.0 and FICO 10T alongside Classic FICO for case numbers assigned on or after January 1, 2027. The change could help lenders recognize creditworthy borrowers whose payment history older models have overlooked.
Why the change is welcome
VantageScore 4.0 considers how credit behavior changes over time. It can also use rent and utility payment history when those payments are reported to the credit bureaus. VantageScore explains that its model can score consumers with limited credit histories who may not receive a score under conventional models.
That gives lenders another way to assess someone who has been paying their bills but has little traditional credit history. For those borrowers, a record of reliable payments could become more useful when applying for a mortgage.
The Mortgage Bankers Association welcomed the expanded choice, pointing to broader access to sustainable credit and potential downward pressure on costs. HUD also describes the change as a way to reach creditworthy borrowers who may have been overlooked under older systems. These are expected benefits, rather than a promise that every borrower will get a higher score or a cheaper loan.
Put the new options to work
For processing teams, preparation can start with their credit and technology partners. FHA encourages that coordination ahead of implementation.
- Confirm how the new models will be ordered and submitted.
- Use test files to see how the results appear in your LOS.
- Make the submitted model and decision score clear in the file handoff.
- Keep the report supporting the final submission available to the reviewer.
One caution: multiple models do not mean the highest score wins
For FHA forward loans scored through TOTAL, submitting several models means applying FHA’s rules across that submitted set. The borrower-level score is the lowest score selected from each submitted model, and every submitted model must receive an Accept for the final recommendation to be Accept. A lender may submit a single model, subject to FHA’s requirements. Confirm the submission choice before treating one higher score as the result for the file.
Loandock’s view
We welcome more ways to recognize a borrower’s payment history. Someone with a limited credit file should have a fair chance to be assessed using the information available about them.
For lenders, the next step is to test these options before January and make sure the people working the file can follow the result.
Effective for FHA case numbers assigned on or after January 1, 2027. The preparation suggestions are Loandock’s editorial recommendations; the cited FHA policy governs each transaction.
