FHA establishes rules for new mortgage credit scoring models

The Federal Housing Administration (FHA) has issued Mortgagee Letter 2026-11 to formalize how lenders must calculate credit scores when using multiple scoring models. This guidance follows the agency’s decision to adopt VantageScore 4.0 and FICO Score 10T alongside the existing Classic FICO model for single-family mortgage assessments.

Under the new rules, which take effect January 1, 2027, lenders must use the lowest selected score for each borrower and the lowest borrower-level score for the transaction when submitting multiple models. This ensures that submitting additional models does not allow a lender to select a higher score to qualify a borrower. For each model, lenders will use the middle score if three credit repositories report different values; if only two are reported, the lower score is used.

Existing FHA credit-score thresholds of 500, 580, and 620 remain unchanged. Additionally, while lenders may submit multiple models to the FHA’s TOTAL Scorecard, every submitted model must independently receive an “accept” recommendation for a loan to obtain an overall “Accept” decision. The agency will continue to require three credit reports for single-family loans.