The Federal Housing Administration (FHA) is expected to go live in January with VantageScore 4.0 and FICO 10T, alongside the existing Classic FICO product, as part of a broad credit score modernization effort, according to industry sources who spoke with HousingWire.
In a call with lenders earlier this week, FHA representatives told participants they will be able to deliver any of the three models for case files dated on or after Jan. 2027, sources said. The shift follows the U.S. Department of Housing and Urban Development (HUD’s April announcement that FHA would adopt FICO 10T and VantageScore 4.0 for FHA loans.
Based on the current discussions, lenders expect model consistency will be required at the loan level, meaning they would not be allowed to mix VantageScore 4.0 and FICO 10T (or other combinations) across co-borrowers on the same file.
HUD and FHA did not immediately respond to HousingWire‘s request for comment.
“You have to have model consistency with your borrowers in the same application, which I think makes some sense. It limits the gaming there,” a person familiar with the discussions said.
At the same time, FHA has said in conversations with industry participants that Classic FICO will not be sunset as part of the rollout, sources added.
Mortgage executives say keeping Classic FICO in production aligns with conditions in the secondary market, where many mortgage-backed securities (MBS) are still collateralized and traded based on Classic FICO. An abrupt retirement of the legacy model could affect “bond liquidity,” one executive said.
Unlike the conventional market overseen by the Federal Housing Finance Agency (FHFA), the FHA rollout is expected to apply to all lenders at launch, according to the sources. FHFA’s own move toward FICO 10T and VantageScore 4.0 has followed a more staggered approach with large lenders actively engaged in testing and implementation.
For FHA, the pricing impact of the model change is expected to be more limited.
FHA generally does not vary base pricing for individual borrowers using credit score and loan-to-value matrices in the same way that Fannie Mae and Freddie Mac do with loan-level price adjustments (LLPAs). Instead, FHA’s economics are driven primarily through its upfront and annual mortgage insurance premiums (MIPs).