Paul Weinstein, Jr., a Senior Fellow at the Progressive Policy Institute, released the following statement:
“This week’s statement by the Federal Housing Finance Authority (FHFA) that it has “validated and approved” of the FICO 10T and VantageScore 4.0 credit scoring models is welcome news. The prior model, FICO Classic, had been in use by Fannie Mae and Freddie Mac for nearly twenty years, and an update was long overdue. Fortunately, the improvements to FICO 10T are significant, and both models will hopefully prove to be more inclusive as both can factor in payment histories for borrowers — such as rent and utilities payments.
“As noted in the past, because Vantage is owned by the three major credit reporting agencies, there is potential for a conflict of interest. This is cause for concern and should be carefully monitored.”
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