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Fair Isaac defines subprime as, generally, less than 640 FICO score
CNBC interviews Fair Isaac CEO about mortgage borrowers; message clashes with those of agencies.

In an interview with CNBC on 2/26/2009, Fair Isaac CEO Mark Greene said, "And in case of the subprime, that's particularly true because the subprime population, which is, generally, a FICO score of less than 640, those are the folks that were aggressively pursued by some of these institutions who were given loans that are now in the process of resetting to unaffordable rates."

The 640 FICO broad brush (-off)

It is not so cut-and-dried. Conflicting with the FICO chief's contention of a 640 standard, the U.S. Department of Housing and Urban Development (HUD) defines two "Sub-Prime" categories below 660: 580 to 619, and 620 to 659.

The Federal Housing Administration (FHA), part of HUD's Office of Housing, announced implementation of risk-based premiums for single family mortgage insurance effective July, 2008. An accompanying chart has tiers based on FICO scores:


In March, 2008, a federal government notice regarding the U.S. Department of Agriculture Rural Development Single Family Housing Guaranteed Loan Program stated, "The purpose of this Administrative Notice (AN) is to affirm 620 as the minimum Fair Isaacs & Company (FICO) credit score required for applicants to utilize streamlined documentation for manually underwritten guaranteed loans."

Other FICO score benchmarks in that notice: "619 and below," "580 and below" and "no FICO score."

In a subsequent notice of clarification the USDA gives another benchmark: Borrowers with FICO scores of "660 and higher."

Conventional loan mortgage insurance company MGIC announced 2/19/09 that, effective 3/9/09, it requires a 680 minimum FICO score in non-restricted markets. Another MI company, RMIC, states, "The minimum loan representative FICO score for loans with an LTV/CLTV less than or equal to 95% is 680... " (see caveats).

See What is a good credit score? for other opinions.


Also, on PART TWO,

Information about your free annual credit report and author's public comment submitted to the Federal Reserve

LexisNexis fiasco, ChoicePoint debacle

April, 1997: "Information on how to obtain one's credit score is suspiciously absent from your site. How do I get mine?"

"And we're not running a game show. I mean, we're evaluating risk. We're not trying to have people get--achieve the highest score."

"Fisher is a fan of going by the book and then beyond it."

"He beat the scoring proponents to the punch by scooping up the web address, from which he launches often strident, sometimes wacky, but usually well-documented attacks on the credit-scoring concept and the industries that support it."

Realty Consumers Empowered By Online "Peoples" Court - "His Web site helped him-- and millions of other consumers-- extend fair credit reporting rights to credit scoring information."

"Fisher operates the Web site, which skewers the secrecy of the credit bureaus and Fair, Isaac." - The Detroit News is an exceptionally-interesting site that offers news and information regarding credit scoring and-- really-- the entire credit process."