![]() It too incorporates non-traditional credit history.Īnd chances are mortgage lenders will continue to use FICO. VantageScore claims that nearly 4 million more borrowers will be scoreable via their new model, which incorporates things like rental history, utilities, and cell phone payments.Īnd because these consumers have 620+ FICO scores, they could be potential mortgage applicants.įor the record, the new FICO 10 T got approved at the same time as VantageScore 4.0. They finally received approval from the FHFA (the overseer of Fannie/Freddie) back in late 2022. It creates a newly scoreable population of 3.8 million minorites with 620+ scoresĪt the moment, no mortgage lenders use VantageScore, but the company is working very hard to change that.The VantageScore 4.0 score was developed by Equifax, Experian, and TransUnion.But the company finally received approval for Fannie/Freddie loans after many years of lobbying.VantageScore isn’t used by any mortgage lenders right now.This also explains why FICO is pretty much the only game in town – it’s hard to change the status quo because there are a lot of moving parts (and investors) in the mortgage space, so one seemingly small alteration could have major ramifications. I think something like 9 out of 10 lenders use FICO, and it’s pretty much 100% in the mortgage world.Īs for the version of FICO, I don’t know if any mortgage lenders use the newer FICO 8 or FICO 9 scores, which are the latest iterations available, because they tend to upgrade slowly to avoid any unwelcome risk. The short answer is FICO scores, which are the industry standard and relied upon by just about everyone. The middle score is used for qualifying and mortgage rate purposesįirst and foremost, you might be wondering which credit score mortgage lenders use, seeing that there’s no sense focusing on something they won’t actually look at to determine your creditworthiness.This creates what is known as a tri-merge credit report.But they pull one version from each of the three major credit bureaus.Mortgage lenders use FICO scores just like other finance companies.TransUnion FICO Risk Score 04 (Classic 04) So be sure to get it right! Which Credit Score Do Mortgage Lenders Use? Credit bureau Simply put, the higher your score, the lower your interest rate, and the more loan options you’ll have. ![]() While credit scores aren’t perfect, and were even blamed for the mortgage crisis of the early 2000s, they do tell lenders a lot about you.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |