Have you seen the headlines saying that “Fannie Mae no longer requires a minimum FICO score” and thought, “Wait… can I buy a house without a credit score now?”—you’re not alone.
Let’s unpack what actually changed, what didn’t change, and what it might mean for you if you’re hoping to buy a home in Richmond (or anywhere else) in 2025. 
The short version
Effective mid-November 2025, Fannie Mae’s automated underwriting system (Desktop Underwriter) is removing its hard minimum credit-score requirement (commonly 620) for new loan case files.
Instead of using a minimum score as a gatekeeper, DU will:
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Still receive a third-party credit score (like FICO or VantageScore) on the file
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Ignore the score as a cutoff, and
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Use its own proprietary risk model—which looks at detailed credit history plus things like debt levels, cash reserves, property type, and loan purpose—to decide whether the loan is eligible for sale to Fannie Mae.
Despite this, Fannie Mae itself says it expects only a negligible change in how many loan applications receive an “Approve/Eligible” recommendation.
So this is more “smart tweak to how risk is measured” than “open the floodgates.” In other words, if your credit is not great, don’t get too excited.
Who is Fannie Mae and what is Desktop Underwriter?
Fannie Mae is one of the two big government-sponsored enterprises (GSEs) that buy a huge share of U.S. mortgages from lenders. By buying those loans and packaging them into mortgage-backed securities, they help keep the mortgage market liquid and rates more stable.
Desktop Underwriter (DU) is Fannie Mae’s automated underwriting system. When your lender “runs DU,” they’re feeding in your:
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Income and employment
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Debts and monthly payments
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Assets and reserves
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Credit report
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Property and loan terms
DU then gives a risk recommendation like Approve/Eligible (green light), Refer (needs more review), based on Fannie Mae’s credit risk standards.
Historically, DU had a minimum credit score requirement—often a 620 FICO score (or average median score for multiple borrowers)—as part of eligibility for most conventional loans.
THAT’S the piece that’s changing.
Okay, so what exactly is changing with credit scores?
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In short, the minimum credit score requirement is being removed for loans submitted to DU.
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DU will no longer apply a rule of “620 or higher” to determine whether a file can be approved.
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Instead, DU will rely on its comprehensive risk assessment—a model that:
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Uses detailed credit-file information and trended data (how your balances and payments change over time)
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Can include on-time rent history and other alternative signals of repayment behavior
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Combines that with non-credit factors such as reserves, loan-to-value ratio, and loan purpose.
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At the same time, Fannie updated its Selling Guide to say that for loans with no traditional credit history, DU will tell lenders when they need to:
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Build a nontraditional credit profile (think rent, utilities, phone, etc.), and/or
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Require homebuyer education for certain borrowers.
Important nuance:
Loans sold to Fannie Mae must still include a valid third-party credit score (FICO or VantageScore 4.0, depending on what the lender uses). The change is that DU is no longer using that score as a simple yes/no gate.
How does this tie into VantageScore and all the other credit-score news?
This change doesn’t exist in a vacuum. It’s part of a broader shift in how credit is evaluated for mortgages:
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In 2022, the Federal Housing Finance Agency (FHFA), which regulates Fannie Mae and Freddie Mac, approved newer models FICO 10T and VantageScore 4.0.
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In July 2025, FHFA announced that lenders selling loans to Fannie and Freddie could use VantageScore 4.0 or Classic FICO, instead of being locked into a single model.
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VantageScore 4.0 is designed to incorporate rent, utility, and telecom payments, and other alternative data, which can help renters and “credit-thin” borrowers look more like the responsible bill-payers they actually are. (Think younger borrowers, or people who have no debt- no debt sounds like a good thing until you go to borrow!)
The National Association of REALTORS® has supported this modernization, calling it a “major step toward a more accurate and equitable mortgage underwriting process” that better reflects how people pay their bills today.
Fannie Mae’s removal of the DU score floor fits right into this theme: less emphasis on a single three-digit number, more emphasis on the full picture of your financial life.
Who could benefit from this change?
Let’s be honest: this is not a magic wand for anyone with truly damaged credit. But it could help certain groups at the margins, especially:
1. Borrowers just under the old 620 line
Credit scores are a major reason applications are denied. For many otherwise solid borrowers, the issue has been scores in the high-500s or teens below 620, even when income, savings, and payment history are strong.
Removing the hard floor allows DU to:
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Approve some loans where the overall risk profile is solid, even if the score is just below 620
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Consider more nuanced factors like trended credit data and on-time rent, instead of a blunt cutoff
2. “Thin-file” borrowers
Think about:
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Long-time renters who pay on time but don’t use a lot of credit
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People who avoid credit cards and mostly use debit
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Some immigrants or younger buyers who simply don’t have much history yet
For these folks, a traditional FICO score can underestimate their credit-worthiness. With VantageScore 4.0 and DU’s expanded use of rental and other data, there’s a clearer path to documenting responsible payment behavior. This change will be a huge help for these people.
3. Certain underserved communities
Research and industry commentary suggest that modernized scoring and less rigid cutoffs may modestly expand access to credit—especially for lower-income and minority borrowers who are more likely to have thin or nontraditional credit files.
No one credible is saying this fixes affordability or solves every barrier to homeownership, and I agree. But it’s definitely a step in the right direction.
What hasn’t changed? (Don’t skip this part.)
This is where the social-media headlines can be misleading. Here’s what didn’t change:
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✅ You still need a credit report and at least one valid credit score on the loan file for Fannie-eligible loans (unless you’re in a very specific nontraditional-credit scenario handled with extra documentation).
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✅ You still have to qualify on income, debts, and reserves. Debt-to-income ratios, loan-to-value, and ability-to-repay rules remain fully in force.
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✅ Bad credit is still bad credit. Late payments, collections, charge-offs, and recent serious delinquencies will still drag down DU’s risk assessment even if the score isn’t being used as a cutoff.
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✅ Lenders can overlay their own standards. Your local lender may still set an internal minimum score to manage their own risk, even if Fannie is more flexible.
So what does this mean if you’re thinking about buying in Richmond?
Here’s how I’d think about it as your friendly neighborhood RVA housing nerd:
1. If your credit is strong (scores well above 620)
For you, this is mostly a non-event. You were already well-positioned to qualify. This change is more of a back-end tweak in how DU evaluates files behind the scenes.
2. If your scores are in the high-500s to low-600s
THIS is where it might matter.
You may now have a better shot at an approval if:
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Your late-payment history isn’t severe or recent
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You have steady income and reasonable debt levels
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You have at least some savings or reserves
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Your overall profile looks strong, even if the score is a bit shy of 620
Will every borrower in this range suddenly get approved? No. But instead of a flat “sorry, you’re below the line,” your file has more room for a nuanced “yes” or “not yet.”
3. If you’re a long-time renter with not much traditional credit
With VantageScore 4.0 in play and Fannie’s emphasis on rent payment history and alternative data, documenting your on-time rent and utilities is becoming more valuable.
If that sounds like you, it may be worth:
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Enrolling in rent-reporting programs (if your landlord supports it- most individual landlords don’t know where to start, so do your research)
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Making sure utility/phone/internet bills are in your name and paid on time
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Talking to a lender who understands both the new scoring models and DU’s updated rules
Practical next steps if you’re curious about your options…
If you’re in the “I’d love to buy, but I’m nervous about my credit” camp, here’s how to use this change to your advantage:
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Pull your own credit reports. (Do this every year regardless!)
Check for errors, duplicate collections, or old items that should have fallen off. -
Ask a lender to run scenarios using DU under the new rules.
They can look at:-
Your current scores (FICO and/or VantageScore)
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How DU reads your full credit profile
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Whether you’re close to an Approve/Eligible or need a little more work
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Focus on the levers DU really cares about:
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Reducing revolving credit utilization (those credit-card balances)
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Keeping everything paid on time for several months
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Building or documenting positive rent history
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Saving for reserves—having money left after closing genuinely helps your profile
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Compare programs.
Sometimes FHA, VA, or other products may still be a better fit depending on your situation, even with this new Fannie Mae flexibility. A good lender will run the comparisons for you. Need a good one? I’ve got some fantastic ones!
FAQ: Fannie Mae’s 2025 credit score change
Q: Does this mean I can get a mortgage with no credit score?
A: Not in the way most people think. For standard Fannie Mae loans, lenders still have to pull a credit report and deliver a third-party score (FICO or VantageScore) with the loan. The change is that DU no longer says “620 or higher or you’re out”—it looks at the full risk profile.
Q: Is FICO going away?
A: No. FICO is still widely used, but FHFA now allows lenders to use VantageScore 4.0 as an alternative for loans sold to Fannie and Freddie. That competition is meant to lower costs and better reflect real-world payment behavior, including rent and utilities.
Q: Does this make homeownership dramatically easier?
A: It’s more of a precision upgrade than a giant loosening of standards. Independent analysts say the impact will likely be modest and most helpful for borrowers just below the old 620 line whose finances are otherwise solid.
Final thoughts (and a Richmond-specific note)
From where I sit, helping Richmond-area buyers and sellers every day- this change is good news, but not a golden ticket.
It’s good news because:
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We’re finally moving away from a world where a single number can slam the door, even when the rest of your financial picture looks fine.
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Responsible renters and “credit-light” buyers get a little more recognition for the way they actually manage money.
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REALTORS®, economists, and housing advocates have been pushing for this kind of modernization for years, and we’re finally seeing it take shape.
We’re still in a market where affordability, inventory, and interest rates are the big hurdles. This rule tweak won’t magically solve those—but it might turn a “not yet” into a “yes” for some would-be homeowners on the margins.
If you’re in or around Richmond and wondering how this new Fannie Mae credit-score policy might affect your path to homeownership, I’m happy to connect you with trusted local lenders who understand these changes and can run real numbers based on your situation.
No scare tactics, no judgment—just clear information so you can make a plan.
Are you ready to get started?
