FICO and its competitor, VantageScore, have been held in suspense to see which credit score model, if any, the Federal Housing Finance Agency will choose to use going forward.
Back in December, the agency requested input from interested parties on a possible change to its credit scoring models. The credit score models being analyzed are Classic FICO, FICO 9 and VantageScore 3.0. This search first began nearly four years ago when Freddie Mac first told HousingWire the GSEs were looking into alternatives to FICO.
But now, the FHFA announced it is postponing its decision and will instead be shifting its focus to implementing the Economic Growth, Regulatory Relief and Consumer Protection Act, which passed into law in May.
The act requires FHFA to define, through rulemaking, the standards and criteria the government-sponsored enterprises will use to validate credit score models.
While the act does not give a clear deadline for approving a new credit score model, they can use the current credit score model until Nov. 20, 2020, the FHFA told HousingWire.
Read more in HousingWire.