Are there any plans to make a new mortgage-specific FICO score to replace the (very) old 5/4/2 version that's still almost universally used by every lender? And if so, how soon do you think most mortgage lenders would make the switch?
It's strange, to me, that one of the largest consumer credit markets in the world, representing the largest loans most of us will ever take out in our lifetimes, uses such old algorithms that haven't been updated in decades. The reason can't possibly be that "5/4/2 are already perfect and there's no reason to update them". Or maybe it is?
Tommy Lee: In mortgage lending, Fannie Mae and Freddie Mac and the FHFA determine the credit criteria and score versions used for most mortgage loan decisions.
They are in the process of evaluating whether newer credit score versions (including the latest FICO Score versions) should replace the FICO Score versions currently being used.