Encompass Lending Group and Equity Resources, Inc. Adopt FICO Score 10 T

Lenders One® Cooperative members will use FICO's newest, most innovative and predictive credit scoring model to help reduce delinquencies and increase mortgage loan approvals

BOZEMAN, Mont.--(BUSINESS WIRE)--Jul. 1, 2024-- FICO, a leading analytics software firm, has announced that Encompass Lending Group and Equity Resources, Inc. are the latest mortgage lenders to embrace FICO's newest, most innovative and predictive scoring model, FICO^® Score 10 T. Their proactive adoption of the model stems from FICO's strategic relationship with Lenders One® Cooperative ("Lenders One"), of which both lenders are members. Lenders One is a national alliance of independent mortgage bankers, banks, and credit unions dedicated to helping its members maximize revenue, reduce costs, and improve decision-making.

Equity Resources, Inc. is a privately held mortgage lender headquartered in central Ohio and licensed in 20 states plus the District of Columbia. Equity Resources, Inc. originates traditional conventional financing but also specializes in FHA, USDA and VA lending, with a balanced approach of selling directly to the GSEs plus aggregators. Based in the greater Houston, TX. area and serving 46 states and the District of Columbia, Encompass Lending Group is a full-service mortgage lender. Notably, Encompass Lending sells 100% of its loans to aggregators rather than government-sponsored enterprises (GSEs). With FICO^® Score 10 T's ability to support application approval lift and reduce delinquencies, both organizations will use the model to enhance their respective origination efforts.

"Our proactive adoption of FICO Score 10 T will enable us to stay one step ahead of the industry," said Kelly Welch, executive vice president of Equity Resources, Inc."We are eager to put the model into action and potentially utilize it to allow more veterans to qualify for VA home loans. We will also use it to compare to the traditional models and expand homeownership into new channels of business."

"At Encompass Lending Group, we strive to help as many people as possible achieve a dream of homeownership," said Paul Marsh, chief financial officer of Encompass Lending Group. "Proactively adopting the industry's most innovative scoring model will further our ability to safely and responsibly deliver on our commitment to our customers."

FICO^® Score 10 T provides even greater precision in making lending decisions and can help lenders better manage credit risk and default rates when extending competitive credit offers to consumers. The model can enable an increase in mortgage originations of up to 5% (without taking on additional credit risk) or reduce default risk and losses by up to 17%. The increased predictive power of FICO Score 10 T can also help lenders project cash flow more accurately.

"With FICO Score 10 T, Encompass Lending Group and Equity Resources, Inc. will be positioned to serve their customers with tools of the highest industry standards," said Joe Zeibert, vice president of Mortgage and Capital Markets at FICO. "We are proud to partner with these forward-looking organizations as they continue to grow their businesses and meet the needs of borrowers."

This news builds upon FICO's recent announcement around mortgage industry adoption of FICO^® Score 10 T reaching a significant milestone: Clients with over $125 billion in annualized mortgage originations and approximately $380 billion in eligible mortgage portfolio servicing rights have signed on to use the model.

FICO is committed to assisting mortgage industry participants looking to transition to its most current model, FICO^® Score 10 T. The FICO Score Migration Resource Center provides a detailed guide to support organizations through their score transition with key planning steps and activities, in addition to implementation best practices.

About FICO

FICO (NYSE: FICO) powers decisions that help people and businesses around the world prosper. Founded in 1956, the company is a pioneer in the use of predictive analytics and data science to improve operational decisions. FICO holds more than 200 US and foreign patents on technologies that increase profitability, customer satisfaction and growth for businesses in financial services, insurance, telecommunications, health care, retail and many other industries. Using FICO solutions, businesses in more than 100 countries do everything from protecting 4 billion payment cards from fraud, to improving financial inclusion, to increasing supply chain resiliency. The FICO^® Score, used by 90% of top US lenders, is the standard measure of consumer credit risk in the US and has been made available in over 40 other countries, improving risk management, credit access and transparency.

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Source: FICO

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