The announcement by the Federal Housing Finance Agency (FHFA) directed that all mortgages securitized by the Government Sponsored Enterprises (GSEs), Fannie Mae and Freddie Mac, will disclose a VantageScore credit score in addition to a legacy score. This move allows lenders to evaluate which score gets borrowers the best rate, helping lower mortgage rates and open the door to homeownership.
The Wall Street Journal recently highlighted why asking your lender to pull your VantageScore could help borrowers lower their mortgage rates and expand homeownership for more seekers.
While competitor credit score models offer a snapshot at a single moment in time, VantageScore analyzes 24 months of trended balance and payment data. By additionally factoring in alternative data like rent and utility payments, it requires less credit history to generate a score.
The Journal discusses the new expanded access of VantageScore 4.0 and what it means for the mortgage landscape. By providing lenders access to a VantageScore 4.0 credit score in addition to a legacy score, one-in-four homebuyers could end up in a higher credit score range. Tony Hutchinson, EVP and Head of Public Affairs, reiterated that historical models and live market data show how scores can land higher or lower across all credit buckets depending on a customer’s credit profile.
VantageScore 4.0 gives lenders a more modern and predictive view of consumer credit risk, helping them responsibly identify qualified borrowers who may be overlooked by traditional credit scoring models. Don’t get left behind — explore piloting VantageScore 4.0 at https://vantagescore.com/insights/vantagescore-4.
Read the full article here: https://www.wsj.com/personal-finance/mortgages/the-simple-request-that-could-lower-your-mortgage-rate-9c4ddc2e?mod=personal-finance_lead_story
