Equifax Fires Back at FICO in Credit Score Wars

What did you do in the credit score war, Equifax? 

Last week, Fair Isaac (better known as FICO) announced a move that would allow it to bypass the Big Three consumer credit reporting middlemen — a.k.a.,  Equifax, Experian and TransUnion. This week, Equifax fired back, slashing prices on its own service that cuts out FICO scores, VantageScore 4.0.

Not So Fair Isaac

If there’s one thing seemingly everyone can agree on, from FICO to the credit-reporting firms to the mortgage credit specialists (known as tri-merge resellers) to mortgage borrowers and even politicians in Washington, it’s that the cost of a credit check is getting too high. It’s why the Federal Housing Finance Agency approved using VantageScore, from a company controlled by the Big Three bureaus, earlier this year as a way to inject some competition in the $13 trillion mortgage market.

It’s also why FICO’s announcement last week was such a big deal. Under its new system, FICO was allowing tri-merge resellers to license its credit reports directly, either for $4.95 (the same fee it charged the credit bureaus) plus $33 once a FICO-scored loan closed, or for a flat $10 per-pop fee. The move directly threatened an earnings hit of as much as 10% to 15% for the credit bureaus, Jefferies analysts estimated in a note to clients last week. “Direct licensing of the FICO score brings transparency, competition and cost-efficiency to the mortgage lending process,” FICO CEO Will Lansing said in a statement last week.

Equifax, it seems, took the call for competition to heart:

• VantageScore 4.0 credit scores will be available for $4.95 per report, with no added fees, through 2027, Equifax announced on Tuesday. The company will also offer free VantageScore reports to any mortgage lenders who are purchasing FICO scores.
• That could seriously test the grip of FICO’s market hold; according to analysts at BMO Capital Markets, FICO still holds a market share of more than 90%.

“The company is responding to FICO’s monopoly-like doubling of their mortgage credit score prices to $10 in 2026,” Equifax said in a statement.

Show Me the Equifax: The market share battle has already begun. In June, the Federal Housing Finance Agency said it would allow Freddie Mac and Fannie Mae to accept VantageScore 4.0 in addition to FICO scores. Investors aren’t quite so sure a true shakeup is coming: Fair Isaac’s share price fell nearly 9% on Wednesday, but remained up more than 14% since its splashy announcement last week. Equifax, which climbed 0.7% on Wednesday, is still down more than 4% since FICO said it would bypass it.