FHA Credit Score Change 2027: VantageScore and FICO 10T
Starting with FHA case numbers assigned Jan 1, 2027, lenders can use VantageScore 4.0 or FICO 10T. Here is what changes for Kentuckiana home buyers.
- buying
- FHA
- Kentuckiana
- credit scores
Key takeaways
- FHA opens two newer score models in 2027. For case numbers assigned on or after January 1, 2027, lenders can use VantageScore 4.0 or FICO 10T alongside Classic FICO (HUD, Mortgagee Letter 2026-11, Oct 8, 2026).
- Minimum score tiers did not change. Below 500 is not eligible, 500 to 579 is capped at 90% loan-to-value, and 580 and above is eligible for maximum financing (HUD, Oct 8, 2026).
- If more than one model is used, the lowest score counts. Within each model the middle score (or lower of two) is picked first, then the lowest across models, then the lowest across borrowers on the loan (HUD, Oct 8, 2026).
- Conventional loans moved earlier. Fannie Mae and Freddie Mac opened VantageScore 4.0 to all lenders on September 9, 2026, and aligned pricing effective October 1, 2026.
- Ask your lender which models it will pull. That one question tells you which number to track before you shop.
Table of contents
- What did FHA change about credit scores?
- Did the FHA minimum credit score change?
- If a lender pulls more than one score model, which score counts?
- How does this connect to Fannie Mae and Freddie Mac?
- What should buyers in Louisville and Southern Indiana do now?
- Does the FHA credit score change affect sellers?
- FAQs
Starting with FHA case numbers assigned on or after January 1, 2027, FHA lenders can use VantageScore 4.0 or FICO 10T alongside Classic FICO. If more than one model is used, the lowest resulting score counts. The minimum score tiers did not change. Sellers are mostly unaffected. Buyers should ask their lender which models it will pull.
If you're planning an FHA purchase in Louisville or Southern Indiana next year, the rules for how your credit score is chosen are about to shift. The minimums stay put, but the number your lender uses could come from a different model than the one you've been watching. Knowing the question to ask now can save you a surprise at preapproval.
What did FHA change about credit scores?
Short answer: FHA is letting lenders use two newer credit score models for case numbers assigned on or after January 1, 2027.
In Mortgagee Letter 2026-11, dated October 8, 2026, HUD says FHA "is adopting alternative credit score models, FICO 10T and VantageScore 4.0, alongside Classic FICO" (HUD, Mortgagee Letter 2026-11, Oct 8, 2026).
When does it start?
The letter says its provisions "are effective for case numbers assigned on or after January 1, 2027" (HUD, Oct 8, 2026). The case number is assigned by your lender during the loan process, so a loan started in late 2026 may still fall under the current rules. Ask your lender which rules will apply to your file.
Why the newer models?
HUD says the new models use trended data, which looks at credit behavior over time, and can draw on non-traditional credit like rent and utilities (HUD, Oct 8, 2026). Whether that helps or hurts any one person's score depends on their own credit file. Nobody can promise a higher score from the switch.
Did the FHA minimum credit score change?
Short answer: no. The score tiers stay the same no matter which model is used.
HUD says "the existing minimum credit score thresholds remain unchanged regardless of Credit Score Model Type" (HUD, Oct 8, 2026). FHA also still requires a tri-merge credit report, meaning a report with data from all three credit bureaus.
| Decision credit score | What the letter says | Source |
|---|---|---|
| Below 500 | Not eligible for FHA-insured financing | HUD ML 2026-11, Oct 8, 2026 |
| 500 to 579 | Limited to a maximum loan-to-value of 90% | HUD ML 2026-11, Oct 8, 2026 |
| 580 and above | Eligible for maximum financing | HUD ML 2026-11, Oct 8, 2026 |
A 90% maximum loan-to-value generally means a larger down payment than maximum financing. Your lender can tell you what that means in dollars for your loan.
If a lender pulls more than one score model, which score counts?
Short answer: the lowest one, after a fixed pick within each model.
Here is the order the letter lays out (HUD, Oct 8, 2026):
- Within each model: if three different scores come back from the bureaus, the lender uses the middle one. If two, the lower one. If one, that one.
- Across models: your borrower score is the lowest of those picks across every model the lender submits.
- Across borrowers: the score that decides the loan is the lowest borrower score on the loan. Borrowers with no credit scores are left out of that step.
The lender also has to use the same model or models for every borrower on the loan. It can't use FICO 10T for one buyer and VantageScore 4.0 for the co-buyer (HUD, Oct 8, 2026).
What this means for co-buyers
If you're buying with a partner, family member, or friend, the lowest score on the loan still sets the tier. That was already true, and the new rules keep it. Our post on co-buying a home with family or friends covers other questions to settle first.
How does this connect to Fannie Mae and Freddie Mac?
Short answer: conventional loans opened VantageScore 4.0 first, with pricing aligned in October 2026. FHA's change starts with 2027 case numbers and also allows FICO 10T.
On September 9, 2026, Freddie Mac announced that all sellers (lenders) may use VantageScore 4.0 when originating and selling eligible mortgages to Fannie Mae and Freddie Mac without prior written approval (Freddie Mac, Credit Score Models and Reports Initiative, Sep 9, 2026). Fannie Mae made the same expansion in its Lender Letter LL-2026-06 (Fannie Mae, reissued Sep 30, 2026).
On September 30, 2026, both companies announced that pricing would be aligned across Classic FICO and VantageScore 4.0, effective for loans delivered or settled on or after October 1, 2026 (Fannie Mae, Sep 30, 2026; Freddie Mac, Sep 30, 2026). In plain terms, the model a lender uses no longer changes those loan-level fees by itself.
Fannie Mae also says adoption is optional, lenders can keep using Classic FICO, and VantageScore 4.0 is not currently eligible for manually underwritten loans (Fannie Mae, Credit Score Models page). FICO 10T for conventional loans is described as a future step.
Conventional vs FHA at a glance
| Conventional (Fannie Mae and Freddie Mac) | FHA | |
|---|---|---|
| Models allowed | Classic FICO, VantageScore 4.0 (FICO 10T later) | Classic FICO, VantageScore 4.0, FICO 10T |
| Timing | VantageScore 4.0 open to all lenders Sep 9, 2026; pricing aligned Oct 1, 2026 | Case numbers assigned on or after Jan 1, 2027 |
| Minimum score rules | Unchanged by these announcements | Unchanged |
| Lender choice | Optional | Lender may submit one or more models |
What should buyers in Louisville and Southern Indiana do now?
Short answer: ask your lender which credit score models it will pull, and when.
That one question tells you which number to track. A few more to bring to that conversation:
- Which model or models will you submit for my loan, and does that change after January 1, 2027?
- If you pull more than one, can you show me each score so I know which one is the lowest?
- With my current scores, which tier am I in, and what down payment would that mean?
- If I'm close to 580, what general steps should I avoid before closing? (New credit and big purchases during the loan process are common ones to ask about.)
Our preapproval to closing timeline and first-time buyer checklist walk through where credit fits in the bigger process. This is general information, not financial advice. Talk to a licensed mortgage lender about your own credit and loan options.
If you're already talking with an agent and want a second view before you commit, Second Opinion is built for that.
Does the FHA credit score change affect sellers?
Short answer: mostly no.
The change is about how a buyer's lender evaluates the buyer. If you're selling, it may come up only when you're weighing an FHA-financed offer, and the buyer's lender is the right source for how solid that buyer's financing is. Sellers in Jeffersonville and across Kentuckiana don't need to change anything because of this letter.
Related reading:
- Co-buying a home with family or friends in Kentucky and Indiana
- Preapproval to Closing: Buyer Timeline in Kentucky
- First-time home buyer checklist for the Louisville area
- What happens after you submit a Match Profile
When you're ready: start your Match Profile, or get a Second Opinion if you already have an agent name.
Ready to talk to a local agent?
Agent Intro is an introduction and referral service for home buyers and sellers in Southern Indiana and Greater Louisville. Tell us your plans on a Match Profile, and a member of our team will review your Match Profile before introducing you to one of our vetted local real estate agents. See How It Works and our FAQ.
FAQs
When does the FHA credit score change start?
For FHA case numbers assigned on or after January 1, 2027, according to HUD Mortgagee Letter 2026-11 (Oct 8, 2026).
Which credit score models can FHA lenders use?
Classic FICO, VantageScore 4.0, and FICO 10T.
Did the FHA minimum credit score change?
No. Below 500 is not eligible, 500 to 579 is limited to a maximum loan-to-value of 90%, and 580 and above is eligible for maximum financing.
If my lender uses two score models, which one counts?
The lowest score across the models the lender submits.
Do sellers need to do anything?
Mostly no. The change affects how a buyer's lender evaluates the buyer.
Disclosure: The agent we introduce may be affiliated with Aire Realty, LLC, which operates Agent Intro. If so, we tell you when we make the introduction. Agent Intro earns a referral fee when an introduction leads to a closed transaction. When the introduction is to a partner brokerage, that brokerage pays the fee to Aire Realty, LLC. Full details are on our Disclosure page. This post is general information, not financial, legal, tax, or lending advice. Agent Intro does not make loans or recommend lenders.
Sources: HUD FHA Mortgagee Letter 2026-11 (Oct 8, 2026); Freddie Mac Credit Score Models and Reports Initiative (Sep 9 and Sep 30, 2026); Fannie Mae LL-2026-06 (reissued Sep 30, 2026) and pricing announcement (Sep 30, 2026). Accessed Oct 12 to 13, 2026.
Ready for a thoughtful introduction?
Tell us about your move. Get one carefully selected introduction. No obligation to hire.
Find my agent ↗