11/10/2025
A lot of people are talking about Fannie Mae removing the minimum FICO requirement and comparing it to 2008. Let’s clear that up before the panic spreads.
Yes, Fannie is removing the hard minimum score, but this does not mean anyone can just walk in and get approved. It simply means DU will look at the full picture instead of using a single cutoff score. Borrowers still have to qualify based on income, debt, assets, and credit history.
Here’s what still matters:
• Collections and charge offs are still a big deal. If someone has unpaid collections or recent derogatory credit, DU will flag it. Borrowers with collections will need to show those are resolved, on payment arrangements, or small enough not to impact qualifying.
• Debt to income ratios still matter. If their income and debts are not in line, the file won’t pass DU.
• Reserves and assets are still verified. Borrowers will still need to document savings or other reserves, especially on tougher credit files.
• Credit history still counts. Just because the minimum score is gone doesn’t mean late payments or charged off accounts are ignored. DU looks at the pattern, not just the number.
• Loan level pricing adjustments are still tied to risk. The lower the overall credit profile, the more expensive the pricing. That hasn’t changed.
Bottom line, this is not 2008 all over again. Fannie is just modernizing how it evaluates risk. The goal is to help people who have solid income and assets but maybe don’t have a perfect score, not to open the door to anyone with bad credit.
If you’ve got a borrower with old collections or a thin file, it’s still smart to get those items cleaned up and documented. DU will still factor them in.
Let’s keep our clients calm and focus on what really matters: verified income, responsible debt levels, and clean recent credit.
—Darin Ramp
Mortgage Loan Officer | Willamette Valley Bank
NMLS #58413 | Willamette Valley Bank NMLS #713109
Equal Housing Lender | Member FDIC
