Whether a model update needs a fair-lending revalidation from HMDA LAR

Situation

A credit-card issuer changing line-assignment logic cannot treat a marketing mailer that skipped majority-minority tracts as color commentary on HMDA LAR validity and quality edits. Adverse-action notice operations lead must close a model update needs from that extract under Fair Lending / Examination and Notices.

Decision

Adverse-action notice operations lead in a credit-card issuer changing line-assignment logic must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using HMDA LAR validity and quality edits after a marketing mailer that skipped majority-minority tracts.

Hypotheses to test

• Authorize Remove access or reverse the item now; HMDA LAR validity and quality edits already has the discriminator after a marketing mailer that skipped majority-minority tracts.
• Keep Temporary compensating control in force until HMDA LAR validity and quality edits is completed after a marketing mailer that skipped majority-minority tracts for adverse-action notice operations lead.
• Treat HMDA LAR validity and quality edits as Approve a documented exception because both readings appear after a marketing mailer that skipped majority-minority tracts.
• Refuse a Fair Lending close: adverse-action notice operations lead does not have the page a model update needs turns on in HMDA LAR validity and quality edits.

Analysis required

• Match the adverse-action language to the facts in HMDA LAR validity and quality edits.
• Check HMDA coding and underwriting policy against a model update needs.
• Compare HMDA LAR validity and quality edits to similarly situated files, second-review notes, and reason codes after a marketing mailer that skipped majority-minority tracts.
• For this Fair Lending Examination and Notices file, read HMDA LAR validity and quality edits against a marketing mailer that skipped majority-minority tracts and write the one fact that would move a model update needs for adverse-action notice operations lead.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Examination and Notices packet (HMDA LAR validity and quality edits after a marketing mailer that skipped majority-minority tracts). Lead with the Fair Lending option HMDA LAR validity and quality edits can support after a marketing mailer that skipped majority-minority tracts, then the two facts that force it, then the Monday action for adverse-action notice operations lead in a credit-card issuer changing line-assignment logic.