Summary:
TransUnion has joined the credit score competition by offering VantageScore 4.0 for $4 starting in 2026, following Experian and Equifax’s moves. This initiative aims to make mortgage credit more affordable by incorporating trended and alternative data, potentially expanding access to homeownership for millions of credit-invisible consumers. The move is a response to FICO’s new pricing model, which bypasses traditional credit bureaus. TransUnion’s TrulQ analytics platform will provide tools to help lenders manage costs and forecast effectively.
What This Means for You:
- If you’re a lender, TransUnion’s VantageScore 4.0 offers a cost-effective alternative to FICO scores, helping you reduce overhead expenses.
- For consumers, especially those with limited credit history, this could mean greater access to mortgage opportunities through the inclusion of alternative data.
- Utilize TransUnion’s free VantageScore 4.0 simulator to better understand credit scoring impacts on loan approvals.
- Be prepared for increased competition in the credit scoring industry, which could lead to more accessible and affordable financial products in the future.
Original Post:
TransUnion is the latest company to make a move in the credit score war between VantageScore and Fair Isaac Corp.’s FICO score, following partners Experian and Equifax.
Transunion will offer VantageScore 4.0, a credit scoring model, for $4 in 2026. Experian will provide it for free to its clients indefinitely and Equifax will charge $4.50 through the end of 2027.
“Our approach reaffirms TransUnion’s commitment to expanding affordable mortgage credit by delivering best-in-class credit information combined with easy-to-use tools for consumers and lenders,” TransUnion President and CEO Chris Cartwright said in a press release Friday.
Now, lenders can use VantageScore to include trended and alternative data at the beginning stages of a mortgage application, which will allow 33 million credit-invisible consumers to be scored and millions more to gain access to homeownership, the release said.
“Trended and alternative credit data provides the most complete picture of consumers, and TransUnion’s new approach unlocks this vital data in the mortgage lending industry, benefitting homebuyers, lenders and investors,” said Satyan Merchant, senior vice president and mortgage business leader at TransUnion.
TransUnion will also offer multi-year pricing for credit report and VantageScore 4.0 to help lenders forecast and manage their business and a free VantageScore 4.0 simulator. This is all available through the company’s new TrulQ analytics platform, the release said.
The major credit bureaus’ moves come as a response to FICO’s new program model announced earlier this month, which lets mortgage resellers bypass the three companies and receive scores directly to avoid additional markup fees. The new program allows resellers to purchase scores for $4.95, the same price it bills credit bureaus, and costs an additional $33 if the loan is closed and avoids reissuance charges lenders previously paid.
But after credit-bureau markups, the average cost is about $10 per score, which is why TransUnion’s release emphasized its “significant discount to the FICO score,” which “burdened” the industry.
The public feud between the credit score providers heated up in July, when Federal Housing Finance Agency Director Bill Pulte announced that Fannie Mae and Freddie Mac will allow lenders to use VantageScore 4.0 when submitting loans to them, instead of just FICO’s. Pulte said in an X post that this would increase competition in the credit score ecosystem.
Extra Information:
What is a Credit Score? – Learn the basics of credit scores and their impact on financial decisions.
FICO Score vs. VantageScore – A detailed comparison of the two major credit scoring models.
FHA Mortgage Guidelines – Understand how credit scores influence FHA loan eligibility.
People Also Ask About:
- What is VantageScore 4.0? – VantageScore 4.0 is a credit scoring model that incorporates trended and alternative data to provide a more comprehensive credit assessment.
- How does VantageScore differ from FICO? – VantageScore uses a broader range of data and scoring criteria, while FICO relies more heavily on traditional credit history.
- Who benefits from VantageScore 4.0? – Credit-invisible consumers and those with limited credit history benefit most from VantageScore 4.0.
- Is VantageScore accepted by all lenders? – While adoption is growing, not all lenders accept VantageScore; Fannie Mae and Freddie Mac now allow its use.
- How can I check my VantageScore? – You can access your VantageScore through credit bureaus like TransUnion, Experian, and Equifax.
Expert Opinion:
The introduction of VantageScore 4.0 by TransUnion represents a significant shift in the credit scoring landscape. By leveraging trended and alternative data, this model not only democratizes access to credit but also fosters competition, which could drive innovation and affordability in the lending industry. This move underscores the growing importance of inclusive financial practices in achieving broader economic equity.
Key Terms:
- VantageScore 4.0 credit scoring model
- Affordable mortgage credit solutions
- Trended and alternative data in lending
- Credit invisible consumer access
- FICO vs. VantageScore competition
- TransUnion TrulQ analytics platform
- Cost-effective credit scoring for lenders
ORIGINAL SOURCE:
Source link
Automatic Mortgage Calculator
Welcome to our Automatic Mortgage Calculator 4idiotz! Please just add your figures in the correct sections below and the Automatic Mortgage Calculator will automatically calculate the results for you and display them at the bottom of the page.
