What does Fannie Mae’s removal of its minimum credit score requirement mean for your ability to qualify for a mortgage today?
Fannie Mae has eliminated its traditional 620 minimum credit score for loans run through Desktop Underwriter®, creating new flexibility for buyers whose credit history doesn’t fit the typical mold — though underwriting standards and risk-based pricing still apply.
Understanding the Fannie Mae Minimum Credit Score Change
For years, conventional mortgages backed by Fannie Mae required a minimum credit score of 620. That benchmark shaped the buying timeline and preparation strategy for many homebuyers.
Now, with the update removing the Fannie Mae minimum credit score, borrowers whose credit scores fall below 620 — or who have a thin credit profile — may still receive a loan approval through DU® (Desktop Underwriter), Fannie Mae’s automated system.
You can review the official Selling Guide update directly from Fannie Mae:
Fannie Mae Selling Guide Announcement (SEL-2025-09)
https://singlefamily.fanniemae.com/media/44146/display
You can also read additional reporting and context from reputable industry outlets:
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HousingWire coverage: https://www.housingwire.com/articles/fannie-mae-credit-score-update/
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MPA Magazine analysis: https://www.mpamag.com/us/mortgage-industry/industry-trends/fannie-mae-scraps-minimum-credit-score-for-du-loans/555870
This update is not a loosening of credit standards; it’s a shift in how approval decisions are made. Rather than relying on a hard score cutoff, DU evaluates the borrower’s full financial picture to determine whether the risk level is acceptable.
Why This Matters: A New Path Toward a No Minimum Credit Score Mortgage
If you’ve delayed making a move because your credit score wasn’t where you hoped it would be, this change may expand your options.
Here’s what a no minimum credit score mortgage could mean for you:
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More flexibility if your credit score is under 620
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Opportunity for buyers with limited or “thin” credit history
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Better recognition of consistent payment behavior, including rent or utilities
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A more holistic financial review, not just a score
This update may be especially helpful for buyers with strong income and employment histories who may not have traditional credit patterns.
What Hasn’t Changed: Underwriting Still Matters
Even with the removal of the score requirement, several fundamentals remain the same:
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DU still evaluates payment history, income stability, debt levels, reserves, and property type.
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Traditional credit scores may still influence pricing and rate options.
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Individual lenders may still impose their own minimum score requirements.
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Mortgage qualification changes don’t guarantee approval — they simply expand the potential pathways.
To better understand this nuance, here’s a helpful explainer (neutral, informational):
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Truth About Mortgage breakdown: https://www.thetruthaboutmortgage.com/no-fannie-mae-and-freddie-mac-havent-abandoned-credit-scores/
Your approval journey is still holistic, and stronger overall financial factors remain your advantage.
How to Prepare as a Buyer
Here’s how you can take advantage of these new mortgage qualification changes:
1. Review your credit file early
Understanding your credit history helps you prepare for lender conversations and correct any inaccuracies.
2. Document consistent payment behavior
Alternative credit such as rent, insurance, or utility payments may strengthen your profile.
3. Strengthen other qualifying factors
Income stability, debt ratios, and reserves carry extra weight in the new model.
4. Expect pricing to vary
A no minimum credit score mortgage may still come with different rate or fee structures depending on your full profile.
5. Work with lenders familiar with the new DU updates
Not all lenders implement guideline changes at the same time. Choose someone who can clearly explain your options based on the most current rules.
Final Takeaway
Fannie Mae’s updated approach marks a significant shift for buyers entering today’s market. The removal of the traditional Fannie Mae minimum credit score doesn’t eliminate underwriting — but it does broaden access for buyers whose financial profile is strong, even if their credit history is unconventional.
If you’re exploring homeownership in Bozeman, Big Sky, or Park City, I’m here to help you understand your options, navigate the process, and move confidently toward your next home.
Contact Me
If you’re planning a move or want clarity around today’s mortgage qualification changes, contact me directly. I’m here to help you take the next step with confidence.
