A veteran broker who knows the system well tells you what to expect, and when
The announcement on Tuesday that Fannie Mae and Freddie Mac would allow the use of VantageScore 4.0 sparked an online frenzy among the mortgage community, with more questions than answers about how and when it would be implemented, as well as what it meant for borrowers.
And while most in the industry applauded the announcement by William J. Pulte, director of the Federal Housing Finance Agency (FHFA), questions quickly followed about how soon the new policy would be implemented.
Josh Lewis (pictured top), a certified mortgage consultant at BuyWise Mortgage, has more than 25 years of experience in the industry. He spoke with the VantageScore team back in 2022, so he has had three years of experience reviewing the data provided by the new credit system.
He believes that it will make a big difference for those with limited credit profiles, which could help gain approval through automated underwriting systems (AUS). For those with an established credit history, they may not notice a significant difference in scores between VantageScore and FICO.
“For borrowers with established credit histories, the scores are generally similar,” Lewis told Mortgage Professional America. “But for thin-file borrowers, there can be a 30- to 50-point spread. Some clients who have no FICO score at all due to inactivity may still show a valid VantageScore. That can absolutely shift the approval path, whether through AUS eligibility or loan pricing tiers.”
More people with a credit score
When Lewis first met with the VantageScore team in 2022, one-third of the newly scored borrowers had a credit score of 620 or higher. That percentage is similar in 2025, with VantageScore 4.0, where more than 12 million out of approximately 33 million new scores are above 620. This could open the door for a surge in first-time homebuyers.
“That puts them within AUS eligibility range for many programs,” Lewis said. “This change allows lenders to evaluate people who previously didn’t generate a score under the current system but who may have strong financial habits and the capacity to own responsibly.”
The scoring system is already being used by lenders when borrowers apply for non-mortgage credit. Lewis believes those lenders may wait until Fannie and Freddie complete their rollout to start using the new system.
“I think many lenders are going to wait and see how Fannie and Freddie roll this out, but adoption across the broader market is likely,” he said. “VantageScore has already been used more than 12 billion times in other industries, including by over 2,200 financial institutions. The infrastructure is already in place, and once mortgage investors become comfortable with performance data from newly scoreable borrowers, we’ll likely see a broader shift.”
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While the new score will provide underwriters with additional data to consider when reviewing a file, it is only one part of the equation when approving someone for a mortgage.
“Lenders will need time to analyze performance data and calibrate overlays,” Lewis said. “But once they see consistent results from borrowers who were previously invisible, we’ll start to see new products and fewer manual underwrites in edge cases. The score itself is only part of the equation. Lenders will still apply their own risk models, but the change gives them a larger pool of applicants to assess.”
Timetable still up in the air
While Pulte made the announcement on X yesterday, it remains unclear when lenders and brokers can expect to see VantageScore replacing, or in addition to, the FICO score.
“The announcement from FHFA is a major milestone, but widespread lender adoption will take time,” Lewis said. “Lenders need to update AUS integrations, pricing engines, compliance protocols, and investor guidelines. That doesn’t happen overnight. But VantageScore has already gone through a full multi-phase review process by FHFA, including validation and model governance standards. The foundation is already in place.”
Despite being familiar with the VantageScore system, Lewis plans to continue using FICO, as it remains the standard in mortgage software such as Desktop Underwriter (DU) and Loan Prospector (LP).
“For now, I still rely on FICO since that’s what the AUS systems and loan pricing models use. Once DU and LP fully support VantageScore 4.0 and lenders adjust their guidelines accordingly, I’ll begin incorporating both scores into my evaluation process, especially for borrowers who are newer to credit or currently unscoreable through traditional models.”
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