Fair Isaac Corp. (FICO) of Bozeman, Montana, launched on Oct. 1 a program that could potentially reshape the way mortgage lenders access customers’ credit scores by sidestepping the country’s three primary credit-reporting agencies.
FICO’s mortgage direct licensing program allows “tri-merge resellers”—companies that bundle credit history data from Equifax, TransUnion, and Experian into a merged credit report—to bypass the credit-reporting bureaus and calculate and distribute FICO scores directly to mortgage lenders.
Streamlining distribution optimizes costs for both tri-merge resellers and consumers, FICO said, as well as increases transparency. Currently, lenders pay a per-score fee of $10. Under the new direct licensing program, however, lenders will pay a royalty licensing fee of $4.95 per score, eliminating a 50-percent markup enacted by credit-reporting agencies….