Fannie Mae’s New Credit Rule: What It Means for Your Buyers

Big news from Fannie Mae: they’ve officially removed the minimum credit score requirement for conventional loans. That’s right—buyers who were previously shut out due to low or limited credit may now have a path to homeownership. Instead of relying on a single score, lenders will take a broader look at a buyer’s financial health, including income, job stability, rent and utility payment history, savings, and overall debt levels.

For REALTORS®, this opens the door to a new wave of potential clients—especially first-time buyers, young adults, and renters who’ve been responsibly managing their finances but didn’t meet the old credit score threshold. It’s a shift toward more inclusive underwriting, and it could reshape how we guide buyers through the loan process.

That said, it’s not without its challenges. Buyers may need to provide documentation for things like rent and utility payments, which could take extra time and preparation. And with more buyers entering the market, we may see increased competition—especially in entry-level price points. That could mean faster-moving listings, more multiple-offer situations, and yes, upward pressure on prices.

On the bright side, lenders now have more flexibility and may offer better financing options thanks to updated technology like VantageScore 4.0, which recognizes non-traditional credit data. As a REALTOR®, your role in helping buyers understand these changes—and prepare accordingly—is more important than ever.

This is a moment to educate, empower, and advocate. Let your clients know that the landscape is shifting, and with the right guidance, they might be closer to homeownership than they think.

Fannie Mae: Selling Guide Announcement (SEL-2025-09)

Reminder: Private mortgage insurance companies still require a minimum 600 or 620 middle credit score for borrowers putting less than 20% down.