Fair Isaac shares plunge as housing regulator pushes for single pricing framework
FICO•Fair Isaac shares fell 27% after the U.S. housing regulator said Fannie Mae and Freddie Mac would use a single pricing grid carrying both VantageScore and FICO scores. The change could put the rival credit scoring models on equal footing.
1. Dual-score pricing grid
Federal Housing Finance Agency director Bill Pulte said Fannie Mae and Freddie Mac will move to a single pricing grid carrying both VantageScore and FICO scores, potentially lowering borrowing costs and challenging Fair Isaac’s long-standing position in mortgage credit scoring.
2. Shares fall sharply
Fair Isaac shares dropped 27% Tuesday, their lowest level since January 2023, and were set for their biggest one-day decline since May 1989. Equifax and TransUnion shares fell 3.2% and 5%, respectively, while London-listed Experian slipped 1.8%.
3. Lender shifts models
Rocket Mortgage said Monday it would become the first mortgage lender to make VantageScore 4.0 its preferred model for all eligible loans. Deutsche Bank analysts said more mortgages could receive favorable pricing with VantageScore 4.0 than with FICO Classic, and said the worst-case interpretation for Fair Isaac would be that Rocket Mortgage stops pulling FICO scores for eligible loans.
