Assess whether a model update needs a fair-lending revalidation (693b04)

Situation

A model update needs sits with second-review underwriter because a marketing mailer that skipped majority-minority tracts hit a credit union rolling out a special-purpose credit program. Evidence is manufactured-housing dealer overlay notes; write the Fair Lending Examination and Notices option that extract can carry.

Decision

Second-review underwriter in a credit union rolling out a special-purpose credit program must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using manufactured-housing dealer overlay notes after a marketing mailer that skipped majority-minority tracts.

Hypotheses to test

• Manufactured-housing dealer overlay notes reads as Remove access or reverse the item once a marketing mailer that skipped majority-minority tracts is lined up to the same Fair Lending population.
• Manufactured-housing dealer overlay notes is closer to Temporary compensating control after a marketing mailer that skipped majority-minority tracts; Remove access or reverse the item would over-claim this Examination and Notices extract.
• Approve a documented exception is still live in manufactured-housing dealer overlay notes for second-review underwriter in a credit union rolling out a special-purpose credit program.
• Manufactured-housing dealer overlay notes is missing the fact second-review underwriter needs after a marketing mailer that skipped majority-minority tracts; stop this Fair Lending close.

Analysis required

• Match the adverse-action language to the facts in manufactured-housing dealer overlay notes.
• Check HMDA coding and underwriting policy against a model update needs.
• Compare manufactured-housing dealer overlay notes 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 manufactured-housing dealer overlay notes against a marketing mailer that skipped majority-minority tracts and write the one fact that would move a model update needs for second-review underwriter.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Examination and Notices packet (manufactured-housing dealer overlay notes after a marketing mailer that skipped majority-minority tracts). Lead with the Fair Lending option manufactured-housing dealer overlay notes can support after a marketing mailer that skipped majority-minority tracts, then the two facts that force it, then the Monday action for second-review underwriter in a credit union rolling out a special-purpose credit program.