FHFA Expands VantageScore Access to All Mortgage Lenders, Sending FICO Shares Down 17%

Federal Housing Finance Agency Director Bill Pulte ordered Fannie Mae and Freddie Mac to immediately approve all mortgage lenders to use VantageScore, ending a pilot program that had been capped at 50 lenders. Pulte declared that "FICO has enjoyed a monopoly. No more," opening one of Fair Isaac's most protected revenue streams to direct competition for the first time.

Fair Isaac shares fell roughly 17% on the news, reflecting the severity of the threat to its mortgage scoring franchise. Equifax dropped about 6.65% and TransUnion fell approximately 6.83%, even though both companies, along with Experian, jointly own VantageScore. The pressure on the credit bureaus stems from a separate Pulte criticism: he attacked the three firms over their pricing and said the FHFA is weighing a "bi-merge" system that would let lenders pull credit data from only two bureaus per mortgage application rather than all three, a move that could meaningfully reduce report volumes and pressure bureau revenue.

The rollout effectively ends FICO's long-standing dominance in mortgage underwriting, where its scores have been the standard required by Fannie Mae and Freddie Mac. VantageScore 4.0 is co-owned by all three major credit bureaus and has been positioned as a lower-cost alternative that its backers say could expand credit access to borrowers underserved by legacy scoring models.