Assess whether dealer overlays introduce prohibited steering after a vendor

SITUATION Model-risk partner for credit scoring in a small-business desk using a new vendor score has one working extract — appraisal-gap outcomes in majority-minority tracts — after a vendor score change with no disparate-impact test. If appraisal-gap outcomes in majority-minority tracts cannot support dealer overlays introduce prohibited, the only defensible Fair Lending output is hold.

DECISION Model-risk partner for credit scoring 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 appraisal-gap outcomes in majority-minority tracts after a vendor score change with no disparate-impact test.

HYPOTHESES TO TEST 1. Model-risk partner for credit scoring can defend Remove access or reverse the item from appraisal-gap outcomes in majority-minority tracts after a vendor score change with no disparate-impact test in a Fair Lending challenge. 2. Model-risk partner for credit scoring cannot defend Remove access or reverse the item from appraisal-gap outcomes in majority-minority tracts; Temporary compensating control is what the extract actually supports after a vendor score change with no disparate-impact test. 3. A vendor score change with no disparate-impact test never reached the population in appraisal-gap outcomes in majority-minority tracts — reopen intake, do not close dealer overlays introduce prohibited. 4. Two facts in appraisal-gap outcomes in majority-minority tracts after a vendor score change with no disparate-impact test conflict for model-risk partner for credit scoring; hold this Pricing and Credit Limits file.

ANALYSIS REQUIRED 1. Compare appraisal-gap outcomes in majority-minority tracts to similarly situated files, second-review notes, and reason codes after a vendor score change with no disparate-impact test. 2. Flag any disparate-impact table model-risk partner for credit scoring cannot explain from appraisal-gap outcomes in majority-minority tracts. 3. Test a documented exception versus a pattern a small-business desk using a new vendor score must defend. 4. For this Fair Lending Pricing and Credit Limits file, read appraisal-gap outcomes in majority-minority tracts against a vendor score change with no disparate-impact test and write the one fact that would move dealer overlays introduce prohibited for model-risk partner for credit scoring.

RECOMMENDATION Treat this reading of appraisal-gap outcomes in majority-minority tracts as the gate for dealer overlays introduce prohibited: Compare appraisal-gap outcomes in majority-minority tracts to similarly situated files, second-review notes, a. If appraisal-gap outcomes in majority-minority tracts after a vendor score change with no disparate-impact test confirms that reading, model-risk partner for credit scoring takes Remove access or reverse the item in a small-business desk using a new vendor score. If appraisal-gap outcomes in majority-minority tracts contradicts it, take Temporary compensating control.