Pulte’s Rewewed Attack on Credit Bureaus Sends FICO Plunging

Shares of credit scoring and reporting companies, including FICO, Equifax, Experian, and TransUnion, experienced significant drops after Bill Pulte, the director of the Federal Housing Finance Agency (FHFA), announced an expansion of VantageScore's use for mortgages and renewed his criticism of the credit bureaus. FICO's shares specifically tumbled 6.6% in pre-market trading, further exacerbating a 21% decline that had been building on the news. This downturn was triggered by Pulte's directive for Fannie Mae and Freddie Mac to immediately approve all lenders to use the VantageScore 4.0 credit scoring system, breaking FICO's long-standing dominance in mortgage origination scoring.

Pulte's statements on X (formerly Twitter) were particularly impactful. He declared, "FICO has enjoyed a monopoly. No more," and accused Equifax, Experian, and TransUnion of "overcharging Americans for far too long." He also indicated that the FHFA is considering "bi-merge" credit scoring models and "stronger solutions" to protect consumers. This regulatory move builds on an earlier limited rollout where 50 lenders had already successfully delivered loans using VantageScore. A VantageScore spokesperson applauded Pulte's actions, citing "significant cost savings and innovation" for consumers and lenders, and noted that VantageScore had already captured over 9% of mortgage securitizations for Fannie Mae and Freddie Mac since May 1, 2026.

The market reaction saw FICO shares fall 6% on Friday morning, with Equifax also down 6% and TransUnion sliding as well. London-listed Experian, a co-owner of VantageScore, saw its shares drop 3.7%. This sell-off was compounded by earlier negative factors for FICO, including a downgrade from Wolfe Research in early August due to a revenue shortfall and intensifying competition, as well as recent insider selling and a disclosed reduced institutional stake. While UBS maintains a Neutral rating on FICO with a $1,130 price target, concerns about its premium valuation and threats to its core scoring franchise persist.