Mark Greene - FICO not to be blamed for mortgage mess

Some people are of the opinion that Fair Isaac, the company that developed FICO score and other companies which provide credit score, like, TransUnion, Experian & Equifax are to be blamed for present mortgage mess because their scores were not able to correctly predict subprime default risk.

But Fair Isaac's Chief Executive Officer (CEO), Dr. Mark Greene does not agree with such thoughts. In a recent interview with cnnmoney.com's editor Paul R. La Monica he said that FICO score has performed well & is not to be considered as one of the causes of present mortgage crisis.

He does agree that there is scope for improvement. And in that context, Fair Isaac is about to release a new credit scoring product by May, named, FICO 08. This new credit scoring product will mainly focus on improving predictive accuracy of credit risk of borrowers who are known as subprime borrowers and also of borrowers with little credit history called as "thin file" borrowers.

According to Greene, Fair Isaac is also coming out in May with what has been named as Credit Capacity Index (CCI). This index will help banks calculate capacity of any prospective borrower of borrowing additional debt. This product will help banks & lending institutions correctly estimate any prospective borrower's creditworthiness.