FICO’s Direct Licensing Cuts Mortgage Score Costs by Half for Resellers
Industry Impact: Resellers Gain Direct Access and Major Cost Savings
FICO has just rolled out its Mortgage Direct License Program, introducing a fundamental shift in how mortgage credit scores are distributed and priced. For the first time, tri-merge resellers can license FICO® Scores directly from FICO, circumventing the traditional route through the three nationwide credit bureaus. This change is expected to cut per-score costs for resellers—and ultimately lenders—by up to 50%.
Key Changes: Two Transparent Pricing Models Give Lenders New Options
At the core of the announcement is FICO’s new performance pricing model, where the per-score royalty fee for tri-merge resellers drops to $4.95—a notable reduction from the previous average of $10 charged via the credit bureaus. Additionally, for funded loans, there will be a $33 fee per borrower per score at closing, replacing the traditional ‘re-issue’ fee structure. Lenders can alternatively stick with the existing model, paying $10 per score with no change in cost. The table below breaks down the new options:
| Model | Per Score Fee | Funded Loan Fee | Typical Savings |
|---|---|---|---|
| Performance Model | $4.95 | $33 | Up to 50% |
| Per Score Only (Legacy) | $10.00 | None | No Change |
Why It Matters: Cost Transparency and Industry Choice
This direct approach isn’t just about price cuts—it introduces much-needed transparency into how scores are delivered and what participants are actually paying for. By stripping away credit bureau mark-ups, FICO places more control and clarity in the hands of resellers and lenders. The move aligns with ongoing calls from policymakers and industry leaders for modernization, improved affordability, and broader access in the $12 trillion U.S. mortgage market.
Potential Ripple Effects: Competition and Flexibility Ahead
FICO’s CEO Will Lansing highlights the move as a turning point: "Direct licensing brings transparency, competition, and cost-efficiency to the mortgage lending process." Both pricing models will also be offered to the three credit bureaus on identical terms, but FICO cannot regulate any further mark-ups they might impose. For the mortgage ecosystem—including insurers, investors, and secondary market participants—the updated model could mean not only lower costs, but broader and more efficient score utilization across loan origination and funding.
Broader Implications: Stability and Standardization Remain Core
FICO underscores its reputation as the only independent analytics provider with a scoring model that has demonstrated reliable performance throughout the entire economic cycle, including the Great Recession. The FICO® Score remains the gold standard for over 90% of top U.S. lenders and has been adopted in more than 40 countries.
What’s Next? Rollout in Progress—Industry to Watch for Shifts
FICO is now working with tri-merge resellers to implement the direct license program. As this unfolds, participants will be monitoring how pricing changes flow downstream, the degree of adoption by lenders, and any responses from the major credit bureaus.
For more detailed information about FICO’s Mortgage Direct License Program, you can visit FICO’s official page.
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