FICO Announces New Mortgage Credit Score
Posted by Benjamin Dona on Friday, October 29th, 2010 at 5:08pm.
Fair Isaac and Company (FICO) announced the release of a new credit scoring product called the FICO 8 Mortgage Score. It was specifically designed to help lenders make better credit decisions in predicting mortgage performance risk and is now available from all three major U.S. credit reporting agencies - Experian, Equifax and TransUnion.
According to FICO, the FICO 8 Mortgage Score will analyze a borrower's full credit history on file to deliver a better assessment of mortgage repayment risk and hopefully help cut down on the number of future foreclosures. FICO claims a 15% performance improvement over the standard credit scores currently available and says the new product includes additional score reason codes to help lenders understand and explain the scores to mortgage applicants.
The FICO 8 Mortgage Score will retain the same 300-850 scoring range, minimum scoring criteria, and inquiry treatment as the standard FICO scores.
As with all the changes that have been implemented since the mortgage crisis began, we have to wonder if simply reverting back to sound underwriting principals might not just solve all the problems that have occurred in the lending industry.
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