Your rent payment could finally help you buy a home – here’s how.
For years, buying a home in America has mostly depended on one thing: your credit score. It’s a number that tells lenders how “trustworthy” you are with money—and for decades, one company called FICO has ruled the credit-score world, especially in mortgages.
But now? Things are changing.
Big Credit News
A major U.S. agency called the Federal Housing Finance Agency (FHFA) just approved a second credit score system called VantageScore 4.0 for use in mortgage loans backed by Fannie Mae and Freddie Mac. These two companies help fund about half of all mortgages in America.
So what’s the deal?
Before this change, lenders could only use FICO scores when giving out government-backed home loans. Now, they can choose between FICO and VantageScore—and that could be huge for people who’ve never had a credit card or bank loan.
Why VantageScore Is Different
Unlike traditional scores, VantageScore 4.0 looks at things that young folks and renters usually do have:
- Rent payments
- Utility bills
- Cell phone payments
If you’ve been paying those on time, VantageScore may reflect that—even if you’ve never had a loan or credit card. That’s a big win for people just starting their financial journey or living in rural areas where banking isn’t easy to access.
What This Means for You
If you’re in your teens, 20s, or 30s and thinking about owning a home someday, this update could help make it easier to qualify – especially if your financial history doesn’t fit the “classic” mold.
The goal here? Expand access to credit. More people, more fairness, and hopefully more homeownership.
You don’t need a perfect credit history to prove you’re responsible. Thanks to changes like these, your everyday payments might finally open real doors – including the one to your first home.
And last, but not least: Ask Gabi, the “judgment free zone” for all of your financial questions!
Talk to Gabi here, for IOS users. And here, for Android users.
Stay tuned! We got you!
GabrielTeam
