FHFA may require lenders to use two credit bureaus for mortgage loans
The Federal Housing Finance Agency is reported to be preparing a directive that would require Fannie Mae and Freddie Mac to accept credit data from only two of the three major credit bureaus instead of all three. FHFA Director Bill Pulte is expected to announce the change as early as Oct. 12 at a mortgage‑industry conference in Chicago. The news sent Fair Isaac (FICO) shares down about 7% after hours and TransUnion (TRU) shares down about 6% in after‑hours trading.
Why it matters
The potential shift to a "bi‑merge" model reduces demand for the traditional three‑bureau credit reports, pressuring credit‑bureau revenues and weakening FICO's dominance in mortgage scoring, as reflected by the immediate share price declines.
Key facts
- 1Fair Isaac shares fell about 7% in after‑hours trading. investing.com
- 2TransUnion shares dropped about 6% in after‑hours trading. investing.com
- 3The FHFA could announce the two‑bureau requirement as soon as Oct. 12 at a Chicago conference. investing.com
- 4FHFA Director Bill Pulte has been pushing to lower credit‑reporting costs. investing.com
- 5FICO stock fell 27% earlier in the week after FHFA placed VantageScore on the same mortgage‑pricing grid as FICO Classic. asktraders.com
- 6FICO shares fell nearly 49% over September. asktraders.com
Summary written by AlphAI from 2 of 2 sources. Not investment advice. Figures are as stated by the linked sources.