Equifax Inc (NYSE: EFX) shares declined 5.62% to $178.46 on Friday afternoon. The sell-off followed Federal Housing Finance Agency (FHFA) Director Bill Pulte’s warning that the agency is seriously considering a shift from tri-merge to bi-merge credit reporting for government-backed mortgages.

Regulatory Pressure and Pricing Criticism

Pulte directed Fannie Mae and Freddie Mac to approve VantageScore 4.0 for all lenders effective immediately. While Equifax co-owns VantageScore alongside Experian and TransUnion, Pulte accompanied the directive with sharp criticism of the three major credit reporting agencies.

In public statements, Pulte accused Equifax, Experian, and TransUnion of operating with "cartel-like" practices and "overcharging Americans for far too long." He noted that discussions regarding fee reductions had yielded little progress, adding that the agency will "not allow companies to take advantage of American consumers."

Pulte highlighted that FICO has increased the price per person’s credit score by 1,800% since 2020, citing this as evidence of monopoly power. He stated that the initial rollout of VantageScore has been successful, with 50 lenders delivering loans under the new framework.

Structural Threat to Mortgage Data Volumes

The primary driver behind the decline in EFX shares is the potential move away from the traditional tri-merge model. Under current rules, mortgage lenders must pull credit files from all three bureaus—Equifax, Experian, and TransUnion—for every home loan delivered to Fannie Mae or Freddie Mac.

A shift to a bi-merge framework would allow lenders to pull reports from only two bureaus. This change would effectively remove one-third of total mortgage report volume across the industry, creating substantial structural revenue headwinds for Equifax.

What the Numbers Show

The market reaction underscores the sensitivity of Equifax’s valuation to regulatory changes in its core mortgage business. While the expansion of VantageScore offers a theoretical benefit through increased adoption, the simultaneous threat of reduced report volume per loan poses a direct risk to revenue streams dependent on the tri-merge requirement. The 1,800% price increase cited by Pulte for FICO scores further highlights the pricing scrutiny facing the sector.

A federal judge has granted preliminary approval to a $100 million settlement in a class action lawsuit against Equifax alleging the company miscalculated credit scores for approximately 4 million Americans. The settlement fund is designated as non-reversionary, meaning any unclaimed funds will not return to Equifax. This marks the largest settlement in history related to the Fair Credit Reporting Act (FCRA).

The lawsuit, In re: Equifax Fair Credit Reporting Act Litigation (Case No. 1:22-cv-03072), received preliminary approval from the Honorable Leigh Martin May in the U.S. District Court for the Northern District of Georgia on August 17, 2026. Gibbs Mura serves as class counsel alongside co-counsel Girard Sharp, DiCello Levitt, and Caplan Cobb. A final fairness hearing is set for January 27, 2026.

Background of the litigation

The litigation centers on a coding error at Equifax that reportedly misreported lowered credit scores for consumers applying for mortgages, auto loans, or credit cards between March 17 and April 6, 2022. According to the lawsuit, scores were sometimes lowered by over 20 points, a shift sufficient to cause lenders to deny credit or charge higher interest rates. The plaintiffs alleged Equifax was reckless in relying on antiquated legacy systems and inadequate testing protocols, resulting in violations of the FCRA.

What the numbers show

The settlement structure indicates a potential payout of $25 per class member based on the $100 million fund allocated for approximately 4 million affected individuals. However, actual payments will depend on the number of valid claims filed and the administrative costs deducted from the total fund. The non-reversionary nature of the fund ensures that the full financial burden remains with Equifax regardless of the final claim rate, removing the possibility of the company reclaiming surplus capital.

Gibbs Mura partner David Berger, court-appointed co-lead counsel, highlighted the accountability aspect of the resolution. Berger previously helped achieve a $1.5 billion settlement with Equifax related to a 2017 data breach affecting 147 million consumers.