FICO, a provider of analytics and decision management technology, has announced that its latest credit scoring product, the FICO 8 Mortgage Score, is now available from all three major U.S. credit reporting agencies. Mortgage lenders now have access to more precise risk assessment tailored for the real estate market, which can help support market stability and reduce borrower, lender and investor risk.
The FICO 8 Mortgage Score was built specifically to help mortgage lenders better predict mortgage performance and improve credit decisions for both current and prospective homeowners. The score analyzes the full credit history on file to deliver significantly sharper assessment of mortgage repayment risk, and aids servicers in earlier identification of borrowers at risk so they can mitigate the incidence and high cost of foreclosure. Validation results have demonstrated an additional predictive value of up to 15 percent for mortgage servicing over the broad-based, all-industry FICO Score used most widely today.
“The FICO 8 Mortgage Score’s broad availability means that all U.S. lenders and servicers can now easily access scores that are fine-tuned for mortgage performance,” said Jordan Graham, executive vice president of scores and president of consumer services at FICO. “Moreover, by combining this superior predictive performance with the FICO Economic Impact Service, lenders are able to adjust policies and strategies quickly based upon forward-looking economic modeling. This is what we mean by the FICO analytic advantage: the ability to use the most advanced predictive analytics to compete and win in this highly challenging environment.”
The FICO 8 Mortgage Score retains the same 300-850 scoring range, minimum scoring criteria, authorized user and inquiry treatment as the general-risk FICO 8 Score. To achieve its significant increase in predictive strength, FICO Mortgage Score assesses several additional data variables from consumer credit files to specifically predict mortgage repayment risk. Accordingly, FICO Mortgage Score includes additional score reason codes compliant with the Fair Credit Reporting Act that help lenders understand and explain the scores to applicants.
For more information, visit www.myFICO.com.