FICO Maker Jumps As New Model Cuts Out Credit Bureau Middlemen

Benzinga

Fair Isaac shares jumped over 20% after it announced a new pricing model allowing mortgage lenders to bypass credit bureaus and license FICO scores directly. The move hit Experian, TransUnion, and Equifax stocks, which fell as much as 10%. Fair Isaac said the plan cuts mark-ups and gives lenders more control over credit score costs.

Transcript

00:00It's Benzinga, bringing Wall Street to Main Street.

00:02Fair Isaac, creator of the FICO score, saw its stock jump more than 20% Thursday after unveiling a new price model

00:08that lets mortgage lenders bypass credit bureaus for credit scores.

00:11The company will now license its scores directly to mortgage resellers who can distribute them to borrowers, according to CNBC.

00:17Shares of Experian, TransUnion, and Equifax fell between 4% and 10% as investors saw the move as a threat to their business models.

00:24Rally marked Fair Isaac's largest one-day percentage gain since November.

00:27Those shares remain down about 9% year-to-date.

00:30Fair Isaac's new plan lets lenders choose between two pricing models,

00:33cutting extra markups and giving them more control over mortgage credit score costs,

00:37according to CEO Will Lansing in the release.

00:40For all things money, visit Benzinga.com.

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