Rent payments could soon unlock homeownership for tens of millions of Americans shut out by outdated credit rules—what does this mean for the housing market?
Story Snapshot
- FHFA directs Fannie Mae and Freddie Mac to use VantageScore 4.0, factoring in rent and utilities for mortgages.
- Targets renters and others without traditional credit histories, potentially aiding tens of millions.
- Trump administration credits deregulation for breaking gridlock, rolling back Biden-era mandates.
- Limited rollout starts with approved lenders choosing between VantageScore or FICO.
- Part of broader push including GSE portfolio expansions to lower rates.
FHFA Announces Credit Score Overhaul
FHFA Director William Pulte announced at a January 2026 press conference that Fannie Mae and Freddie Mac must adopt VantageScore 4.0 for mortgage evaluations. This model incorporates rent and utility payment histories with traditional credit data.
Pulte stated that renters who have paid bills for years deserve credit recognition. The change targets Americans lacking robust credit card or loan records.
Approved lenders begin limited rollout, opting for VantageScore or FICO. Pulte predicted benefits for tens of millions amid housing affordability struggles.
Trump administration makes Fannie, Freddie change it says will benefit 'tens of millions' of Americans https://t.co/F7vysmnvgR
— FOX Business (@FoxBusiness) April 24, 2026
Historical Roots of Fannie and Freddie Constraints
Congress created Fannie Mae in 1938 and Freddie Mac in 1970 as government-sponsored enterprises to buy and securitize mortgages, ensuring market liquidity.
The 2008 crisis triggered the FHFA conservatorship, with Treasury imposing a $450 billion cap on the combined portfolio. FHFA limited each GSE to $25- $ 40 billion in mortgage bonds to curb risk following massive bailouts.
Bipartisan caps endured until Trump’s 2025 reelection enabled reversals. Biden-era FHFA rules prioritized affordable housing quotas over broad access, drawing criticism for harming middle-class buyers.
Key Players Driving the Shift
William Pulte oversees Fannie and Freddie as FHFA Director, announcing credit changes and portfolio hikes. President Trump directs policy, instructing the Federal Reserve to buy $200 billion in bonds to pressure the Fed to cut rates.
Fannie Mae and Freddie Mac implement VantageScore while expanding portfolios to $225 billion each. VantageScore and FICO provide models including alternative data.
FHFA has the authority to issue directives without prior approval from the GSEs. Pulte credits Trump’s victory for dismantling special-interest barriers and aligning with conservative deregulation values.
Recent Timeline and Portfolio Expansions
December 2025 saw FHFA finalize 2026-2028 housing goals, rolling back Biden mandates. January 9, 2026, reports detailed Trump’s $200 billion mortgage debt buy request.
FHFA emailed the GSEs on January 12, raising bond limits from $40 billion to $225 billion each, enabling increases of over $170 billion. Freddie Mac tested VantageScore earlier, securitizing $10 million in loans.
Wednesday’s announcement launched the modernization of credit scores. GSEs have already added $40 billion in securities since July 2025, tightening spreads by 40 basis points.
Trump administration makes Fannie, Freddie change it says will benefit 'tens of millions' of Americans https://t.co/F7vysmnvgR
— FOX Business (@FoxBusiness) April 24, 2026
Impacts on Borrowers and Markets
Short-term renters gain easier access to mortgages, boosting homeownership for middle-class families without traditional credit. Bond purchases temporarily lower rates, enhancing liquidity.
In the long term, larger portfolios reverse 2008 safeguards, risking systemic exposure if defaults rise. Critics question the Treasury’s unconsulted involvement, but facts support Pulte’s claims of inclusivity over quota-driven prior policies.
Expert Views and Risks
Fannie executive Jake Williamson states that new models deliver superior prediction for sustainable ownership. Bloomberg’s Erica Adelberg notes that GSE buys align with prior additions, but the scale raises balance-sheet duration concerns.
Housing analysts call portfolio hikes a risky Trump test run post-2008. Proponents highlight credit inclusivity; skeptics warn of a reversal in safety consensus.
FHFA emphasizes that modernization ensures safety and access. Diverse opinions reflect pro-deregulation momentum versus caution on rapid expansions.
Sources:
Fannie and Freddie Empowered to Support Middle-Class Homeownership
What happened to mortgage bonds? Trump, Pulte, Fannie Mae, Freddie Mac
