topic Fico’s dominance in US credit scoring under challenge in Credit in the News

Fico’s dominance in US credit scoring under challenge

Binner — Wed, 23 Jun 2021 19:11:17 GMT

Pressure mounts to address inequalities over access to credit by consumers

The US Federal Housing Finance Agency has asked Fannie Mae and Freddie Mac to consider approving a newer Fico model, as well as VantageScore, for use by lenders.

If the latter is approved, lenders can begin extending mortgages to up to 40m additional consumers and would receive an implicit signal to go further with alternative models in other lending categories.

This decision would also end Fico’s effective monopoly in mortgage lending and would have implications for its rich valuation. The company has made the most of this dominant role by systematically renegotiating pricing with lenders since 2018. This has driven outsized revenue and margin growth.

Re: Fico’s dominance in US credit scoring under challenge

SouthJamaica — Wed, 23 Jun 2021 20:27:32 GMT

The article is paywalled.

Re: Fico’s dominance in US credit scoring under challenge

KatSoDak — Thu, 24 Jun 2021 01:26:57 GMT

Here's another link:

https://californianewstimes.com/ficos-dominance-in-us-credit-scoring-under-challenge/407713/

I read the article this morning. Sounds like the process is moving along as they are in the comment phase. If Vantage scores are used I wonder how they will reconcile the two (Fico vs Vantage).

Re: Fico’s dominance in US credit scoring under challenge

IntegerIntrovert — Thu, 24 Jun 2021 05:17:15 GMT

Doesn't seem we have a "lack of qualified buyers" in today's real estate market. I'm all for abolishing monopolies, however, if we are going to talk about that why don't we talk about Fannie and Freddie. I digress.

Re: Fico’s dominance in US credit scoring under challenge

babygirl1256 — Thu, 24 Jun 2021 05:32:06 GMT

Greetings Binner ~ great posting. I will certainly keep up with this one . . . My Vantage Scores are slightly higher than my FICO Scores -but- I try to watch them all.

Re: Fico’s dominance in US credit scoring under challenge

pizzadude — Thu, 24 Jun 2021 19:03:27 GMT

But the most notable solution from the bureau is their joint venture VantageScore — Provides credit scores to 40 million individuals who are Fico’s direct credit scoring competitors and are not otherwise scored

I'm curious as to what other factors are included in Vantage, utility payments, bank account balances...?