Spiking fees leaves industry searching for answers to reduce borrower expenses
As affordability challenges impact the mortgage lending process, attention is turning toward the increased cost of credit report pulls. As the government considers action to curb these costs, one industry expert has questioned whether creative solutions could be available.
Mortgage broker organizations have been raising awareness of rising credit report pull costs, which has caught the attention of Bill Pulte, director of the Federal Housing Finance Agency (FHFA). He posted on his X account his displeasure with the cost increases.
“Still not happy with FICO,” Pulte said. “We should be making some decisions on all related items in next 1-3 weeks.”
While FICO has increased its costs, some of the cost increases have been attributed to the credit bureaus.
Jim Nabors (pictured top), president of the National Association of Mortgage Brokers (NAMB), discussed the issue with the FHFA.
“We met with the FHFA on numerous issues, but one of them was the cost of credit,” Nabors told Mortgage Professional America. “The cost is just constantly going up. When you look back at 2010, a tri-merge was $15 to $20. And yet now, in many cases, it’s over $100. Why? So far, the answer is, ‘Cybersecurity. We’re trying to prevent fraud.’ So you have to increase your cost 500% just to upgrade cybersecurity? I just don’t think so.”
Why is a tri-merge needed in 2025?
Nabors discussed the history of credit reporting in the United States, and the path that led to the current three bureaus: Experian, Equifax, and TransUnion, using his home state of Ohio as an example.
“First, there were smaller (credit bureaus),” he said. “There was a Cincinnati credit bureau, there was a Cleveland credit bureau, there was a Columbus credit bureau. They collected the data from the areas in their neighborhoods. So, maybe you needed more than one credit bureau. But now, it's pretty much nailed down to just the three: Equifax, TransUnion, and Experian.”
Before recent changes, the given reports could be different from each other, but that is no longer the case.
“Previously, you only had to report to one credit repository,” Nabors said. “You didn’t have to report to all three. So you had to get a tri-merge so you could see, maybe your car payment wasn’t reported to one. But now, they have to report all three. So, what is the purpose of the tri-merge?
“So, maybe we don’t need to be paying for three credit bureaus.”
Nabors said that when the cost of tri-merges was low, banks and lenders would often absorb that cost. Now, they charge the customer upfront.
“In 2010, a tri-merge cost $15,” Nabors said. “Everybody in the world ate that cost. It was the cost of doing business. But now that it’s $100, now you want the money up front. So, it’s costing not only people who are getting loans. It’s costing money for people to find out that they don’t qualify for a loan.”
Looking for creative solutions
While it is still unclear what changes Pulte will suggest regarding the cost of credit scores, the rest of the industry is still looking for creative solutions to save customers money at a time when affordability is a challenge.
Melissa Cohn of William Raveis Mortgage says affordability, not interest rates, is holding the market back. With life transitions unavoidable and costs rising, she urges lenders to focus on realism and responsible lending. https://t.co/AHHipAWHyi
— Mortgage Professional America Magazine (@MPAMagazineUS) May 28, 2025
One idea suggested to Nabors by a NAMB ember was the ability to make a credit report portable. Nabors suggested it could be similar to the appraisal process.
“If you pay for an appraisal through me, and then you decide, ‘I’m not going through Civista Bank, I’m going to go through Mason County banks or a community bank, the appraisal can be transferred over to them,” Nabors said. “Why can’t a credit bureau be transferred from one lender to another?”
Each American is entitled to one free credit report annually by going to annualcreditreport.com.
While the report is typically sent to the customer, one NAMB member suggested potentially allowing people to assign that report to a lender, which would then save the cost of a credit pull.
“We all agree that a borrower can’t supply their own appraisal,” he said. “That’s against the law. Yes, they can’t currently supply their own credit bureau, but if they’re getting it (at annualcreditreport.com), why can’t they just assign it to a specific lender?”
Nabors notes it’s a tricky issue because the credit bureaus have to be able to make money to stay in business. He notes that’s why the NAMB hasn’t taken an official position on the issue.
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
