Assess whether pricing disparities are justified by legitimate factors

SITUATION Model-reason-code mapping that does not match notices arrived with a vendor score change with no disparate-impact test. Second-review underwriter in a lender expanding into majority-minority census tracts still has an evidence gap on whether pricing disparities are justified by legitimate factors.

DECISION Second-review underwriter in a lender expanding into majority-minority census tracts must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using model-reason-code mapping that does not match notices after a vendor score change with no disparate-impact test.

HYPOTHESES TO TEST 1. A vendor score change with no disparate-impact test is noise around an already-controlled CRA and Special-Purpose Programs process in a lender expanding into majority-minority census tracts, given model-reason-code mapping that does not match notices. 2. A vendor score change with no disparate-impact test is the event in model-reason-code mapping that does not match notices that forces Remove access or reverse the item for second-review underwriter under Fair Lending. 3. Model-reason-code mapping that does not match notices shows a one-file miss after a vendor score change with no disparate-impact test, not a CRA and Special-Purpose Programs program failure. 4. Model-reason-code mapping that does not match notices cannot decide pricing disparities are justified yet after a vendor score change with no disparate-impact test; hold is the only Fair Lending close a lender expanding into majority-minority census tracts can defend.

ANALYSIS REQUIRED 1. Test a documented exception versus a pattern a lender expanding into majority-minority census tracts must defend. 2. Match the adverse-action language to the facts in model-reason-code mapping that does not match notices. 3. Check HMDA coding and underwriting policy against pricing disparities are justified. 4. For this Fair Lending CRA and Special-Purpose Programs file, read model-reason-code mapping that does not match notices against a vendor score change with no disparate-impact test and write the one fact that would move pricing disparities are justified for second-review underwriter.

RECOMMENDATION Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / CRA and Special-Purpose Programs packet (model-reason-code mapping that does not match notices after a vendor score change with no disparate-impact test). Lead with the Fair Lending option model-reason-code mapping that does not match notices can support after a vendor score change with no disparate-impact test, then the two facts that force it, then the Monday action for second-review underwriter in a lender expanding into majority-minority census tracts. Second-review underwriter must then execute Remove access or reverse the item or Temporary compensating control on model-reason-code mapping that does not match notices after a vendor score change with no disparate-impact test for this Fair Lending CRA and Special-Purpose Programs close in a lender expanding into majority-minority census tracts.