On October 1, 2025, Fair Isaac Corporation (FICO) announced the launch of its FICO Mortgage Direct License Program, enabling tri-merge resellers to calculate and distribute FICO Scores directly to mortgage lenders without requiring credit bureau intermediation. FICO Launches Cost-Cutting Direct License Program for Mortgage Lending | FICO This represents a fundamental shift in how the mortgage industry accesses credit scoring data and has immediate implications for pricing transparency and operational costs.
The program introduces two distinct pricing models designed to reduce costs for lenders. Under the new performance model, FICO charges a royalty fee of $4.95 per score—representing a 50% reduction in average per-score fees—plus a $33 funded loan fee when a FICO-scored loan closes. FICOBusiness Wire Alternatively, lenders can opt for a traditional per-score pricing model at $10 per score, matching the average price previously charged by credit bureaus but without additional bureau mark-ups. FICOBusiness Wire
The market reaction was swift and significant. FICO shares surged as much as 32% on October 2, 2025, while shares of the three major credit bureaus—Experian, Equifax, and TransUnion—declined sharply, with drops ranging from 5% to 12%. Yahoo!Investing.com Industry analysts project this change could pressure credit bureau earnings by an average of 10% to 15%, as FICO's direct licensing model eliminates the bureaus' ability to mark up FICO scores. Yahoo!Investing.com
FICO emphasized that firms preferring to work through credit bureaus can continue to do so, and the company will offer both pricing models to the three nationwide credit bureaus on the same terms. FICO Launches Cost-Cutting Direct License Program for Mortgage Lending | FICO However, FICO noted it cannot control any additional pricing mark-ups the bureaus may impose in their distribution channels.
This strategic move comes amid intensified competition following the Federal Housing Finance Agency's decision to allow Fannie Mae and Freddie Mac to purchase loans underwritten with VantageScore 4.0—a credit bureau-owned scoring model—as an alternative to the Classic FICO score. FICO bypasses credit bureaus with new program for mortgage lenders FICO's program aligns with calls from policymakers and industry leaders to modernize credit infrastructure and promote affordability, liquidity, and access in the $12 trillion U.S. mortgage industry. FICO Launches Cost-Cutting Direct License Program for Mortgage Lending | FICO