FICO Resources for the Secondary Market
Fine tune your structured finance and securitization efforts.
Welcome to the FICO Secondary Market Resource Center
FICO provides the standard measure of consumer credit risk in the United States. Trusted for more than three decades and through all economic conditions, the FICO® Score is reliable, predictive, and innovative. Leveraging traditional credit and new alternative data sources, FICO is focused on enabling lenders and investors worldwide to expand access to credit and capital. We have pioneered innovative tools to measure portfolio risk to help the industry safely keep credit flowing.
Securitizing based on the proven FICO Score provides less uncertainty and more liquidity across the secondary markets. Whether it’s for auto finance, credit cards, mortgage loans or other structured finance products, we’re here to serve you.
The FICO Secondary Market Resource Center provides insights for more precise lending and investing, risk management, and secondary market and securitization efforts. Here you will find:
- FICO Thought Leadership Research
- Independent Research Briefs
- FICO Score Performance Insights
- Building Resilient Portfolios
FICO® Scores were solely cited as the credit risk measure in 97% of total dollars in U.S. securitizations.*
*Mercator Advisory Group Asset Back Securitization Study 2022
Cardinal Financial Issues First Mortgage-backed Security Using FICO Score 10 T
The first-ever government-issued mortgage-backed security (MBS) with loans originated using FICO Score 10 T has been issued by Cardinal Financial and included loans from the U.S. Department of Veteran Affairs (VA).
FICO Score 10 T utilizes trended data for lender use in understanding credit behavior over time, which enables more accurate risk assessments. Cardinal Financial’s pool was traded to a primary dealer on Nov. 25, 2024.
FICO collaborated with the VA to confirm acceptance of FICO Score 10 T ahead of the widespread transition to the new FICO Score as required by the Federal Housing Finance Agency (FHFA). Cardinal was one of the first lenders to adopt FICO Score 10 T for its nonconforming loans.
More than 20 mortgage lenders nationwide have now adopted FICO Score 10 T for mortgage loans that aren’t purchased by Fannie Mae or Freddie Mac
Mortgage investors are encouraged to consider the advantages of incorporating FICO Score 10 T into their models.
Assessing the Risks: Different Credit Scoring Models and Impacts on the Mortgage Market
This independent research report shows why minimum scoring criteria adds reliability to a credit score and how removing it makes the credit score both less predictive and in the long run more costly for everyone. Kroll analyzed the credit failure rate over a two-year period across a data set of 40 million credit scores from individuals who had either a FICO Score or an alternative score in which FICO’s minimum scoring criteria are not used. The research showed higher credit risks for both consumers and lenders when using the alternative scoring model. In particular, alternative credit scores used in Residential Mortgage-Backed Securities (RMBS) ratings carry significant risks. Kroll’s research finds that the economics of securitization will be less efficient and may result in the transfer of the cost of both increased default and prepayment uncertainty back to the consumer. In short, minimum credit scoring criteria provide an important protection against unnecessary credit risk.
Why Secondary Market Investors Should Use FICO Score 10 T with Jim Wehmann
Jim Wehmann, Executive Vice President of FICO, in conversation with Joe Seidel, Chief Operating Officer of SIFMA, on why the newest and most powerful FICO credit scoring model yet is the proven and reliable choice for secondary market investors world-wide.
Why Secondary Market Investors Should Use FICO Score 10 T with Julie May
Julie May, Vice President and General Manager of B2B Scores at FICO, in conversation with Joe Seidel, Chief Operating Officer of SIFMA, on capital market appetite for Mortgage-Backed Securities decisioned with FICO® Score 10 T.
