Mortgage Credit Check Fees Surge: Homebuyers Face Rising Costs

Homebuyers are facing another rising cost in an already expensive market: credit report fees. Whereas seemingly a small part of closing costs, the price lenders pay to check a borrower’s credit is increasing significantly, and those costs are often passed on to the consumer.

Costs in 2026 could rise an average of 40% to 50%, according to a December letter from the Mortgage Bankers Association (MBA) to Federal Housing Finance Authority (FHFA) Director Bill Pulte. This increase is prompting debate within the mortgage industry and raising concerns for prospective homeowners.

Al Bingham, a loan officer with Momentum Loans in Sandy, Utah, described the situation as “nuts,” noting the exponential rise in the cost of tri-merge reports.

Currently, most lenders rely on a “tri-merge” report, which pulls credit scores and reports from the three major credit bureaus: Equifax, Experian, and TransUnion. The MBA is asking the FHFA to allow lenders to use a single credit report for borrowers with a credit score of 700 or higher, potentially reducing costs.

The reasons for the price hikes are complex. The Consumer Data Industry Association (CDIA) points to increasing pricing from FICO, the company that provides the widely used credit score. The MBA, however, suggests both the credit-reporting companies and FICO share responsibility.

FICO launched a direct-to-lender score this year, which would bypass the credit-reporting companies. FICO’s royalty for 2025 is $4.95 per score, marking its fourth increase since 1989.

While credit reporting fees represent a small portion of overall closing costs – which generally range from 3% to 6% of the loan amount – the increase adds to the financial burden for homebuyers. For a $350,000 mortgage, closing costs can range from $10,500 to $21,000.

Bingham shared an example of a 40.4% year-over-year increase in the cost of a basic tri-merge report, rising to $47.05 in 2026 from $33.50 the previous year. This cost doubles for an individual applicant if the report is pulled twice during the loan process and quadruples for a couple.

Fannie Mae, a major purchaser of mortgages, announced in November that it would no longer require a minimum credit score for applications processed through its automated underwriting system. However, most homebuyers have higher credit scores; the average first-time homebuyer had a score of 734 in 2024, according to the Federal Reserve Bank of New York, while repeat buyers averaged 775.

The FHFA similarly approved the use of VantageScore 4.0, a competitor to FICO, which considers alternative data like rent and utility payments. However, VantageScore 4.0 is not yet widely implemented.

While the MBA argues a single credit report is sufficient for borrowers with high credit scores, some experts disagree. John Ulzheimer, a credit expert and president of The Ulzheimer Group, believes three reports provide more comprehensive information and are crucial for risk management.

Lenders typically pull a borrower’s credit report twice during the home-buying process: once at application and again before closing.

What is a tri-merge credit report?

A tri-merge credit report combines information from Equifax, Experian, and TransUnion to give lenders a comprehensive view of a borrower’s credit history.

Why are credit report fees increasing?

Increased pricing from FICO and the credit-reporting agencies are contributing to the rising costs.

Could I benefit from a single credit report?

If you have a credit score of 700 or higher, you may benefit from a lender using a single credit report, potentially lowering your closing costs.

What are closing costs?

Closing costs include various fees associated with finalizing a home purchase, such as loan origination fees, appraisal fees, and agent commissions, typically ranging from 3% to 6% of the loan amount.