Friday, October 29, 2010

New credit score for mortgage loans

This just in from Florida Association of Realtors.... MINNEAPOLIS – Oct. 29, 2010 – FICO announced that its latest credit scoring product, the FICO 8 Mortgage Score, is now available from all three major U.S. credit reporting agencies.

The FICO 8 Mortgage Score was built specifically to help lenders better predict mortgage performance and improve credit decisions. The score analyzes the full credit history on file to deliver a better assessment of mortgage repayment risk, with an eye toward cutting down on the number of future foreclosures. FICO claims a 15 percent performance improvement over credit scores currently available.

“To do the best job of evaluating risk and increasing profits, lenders need updated credit scoring analytics that incorporate mortgage credit performance since the subprime mortgage meltdown,” says Craig Focardi, senior research director at TowerGroup.

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 score. To achieve its increase in predictive strength for mortgages, the FICO 8 Mortgage Score assesses additional data from consumer credit files to predict mortgage repayment risk.

The FICO 8 Mortgage Score also includes additional score reason codes, compliant with the Fair Credit Reporting Act, to help lenders understand and explain the scores to applicants.

© 2010 Florida Realtors®

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