Assess whether a model update needs a fair-lending revalidation (96c69d)

Situation

Examination and Notices work in a small-business desk using a new vendor score now turns on a model update needs because a SPCP that originated almost no loans to the intended class put credit-card limit assignment disparity table in play. HMDA data-quality manager should say what credit-card limit assignment disparity table proves.

Decision

HMDA data-quality manager in a small-business desk using a new vendor score must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using credit-card limit assignment disparity table after a SPCP that originated almost no loans to the intended class.

Hypotheses to test

• A SPCP that originated almost no loans to the intended class is noise around an already-controlled Examination and Notices process in a small-business desk using a new vendor score, given credit-card limit assignment disparity table.
• A SPCP that originated almost no loans to the intended class is the event in credit-card limit assignment disparity table that forces Remove access or reverse the item for HMDA data-quality manager under Fair Lending.
• Credit-card limit assignment disparity table shows a one-file miss after a SPCP that originated almost no loans to the intended class, not a Examination and Notices program failure.
• Credit-card limit assignment disparity table cannot decide a model update needs yet after a SPCP that originated almost no loans to the intended class; hold is the only Fair Lending close a small-business desk using a new vendor score can defend.

Analysis required

• Test a documented exception versus a pattern a small-business desk using a new vendor score must defend.
• Match the adverse-action language to the facts in credit-card limit assignment disparity table.
• Check HMDA coding and underwriting policy against a model update needs.
• For this Fair Lending Examination and Notices file, read credit-card limit assignment disparity table against a SPCP that originated almost no loans to the intended class and write the one fact that would move a model update needs for HMDA data-quality manager.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Examination and Notices packet (credit-card limit assignment disparity table after a SPCP that originated almost no loans to the intended class). Lead with the Fair Lending option credit-card limit assignment disparity table can support after a SPCP that originated almost no loans to the intended class, then the two facts that force it, then the Monday action for HMDA data-quality manager in a small-business desk using a new vendor score.