UWM says 25% of borrowers benefit from new credit score model

United Wholesale Mortgage (UWM)’s early adoption of VantageScore 4.0 is shifting outcomes for one-quarter of its borrowers, the company said. It aligns with analysts’ estimates based on historical data. UWM said about 25% of its borrowers are currently seeing a more advantageous credit result when using the new model instead of a Classic FICO score. This potentially equates to better loan-level price adjustments (LLPAs), lower mortgage insurance costs, expanded loan eligibility and, in some cases, converting a declined application into an approval. The company expects that share could reach two in five borrowers by the end of this month. The impact comes without changing lending standards, UWM added. “The addition of VS4 has been one of the best things that has come from FHFA (Federal Housing Finance Agency) in many, many years,” Mat Ishbia, UWM president and CEO, said in a statement. “This is what expanding homeownership actually looks like.” Limited adoption so far Since a rollout program program began in April, the market has seen about $8.6 billion in loan originations that include VS4, according to data from Bank of America Securities. Roughly 98% of that total, however, has c...