Some newer lending companies are rethinking the way customers apply for loans by challenging the merits of the FICO score, reports The Wall Street Journal staffer Peter Rudegeair.

The traditional FICO credit score has been calculated since the late 1980s by Fair Isaac Corp. Now, a variety of lenders are betting that their new scoring models aimed at expanding credit will hold up in a tougher business environment.

Social Finance Inc., a San Francisco company that offers student-loan refinancing, mortgages for high-priced homes and personal loans, has decided to do away with FICO scores in its credit decisions, making it one of the highest-profile lenders to do so. “We just don’t think the score itself is a real driver to credit performance,” says Mike Cagney, chief executive of SoFi, as the company is known.

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