Assess whether a model update needs a fair-lending revalidation (e3adad)

Situation

In a mortgage company after a pricing-regression spike, small-business decline comparative file set is the evidence after a board asking if the bank should settle a matched-pair study. CRA strategist has to pick Remove access or reverse the item or Temporary compensating control for this Fair Lending CRA and Special-Purpose Programs close using small-business decline comparative file set.

Decision

CRA strategist in a mortgage company after a pricing-regression spike must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using small-business decline comparative file set after a board asking if the bank should settle a matched-pair study.

Hypotheses to test

• A board asking if the bank should settle a matched-pair study is noise around an already-controlled CRA and Special-Purpose Programs process in a mortgage company after a pricing-regression spike, given small-business decline comparative file set.
• A board asking if the bank should settle a matched-pair study is the event in small-business decline comparative file set that forces Remove access or reverse the item for CRA strategist under Fair Lending.
• Small-business decline comparative file set shows a one-file miss after a board asking if the bank should settle a matched-pair study, not a CRA and Special-Purpose Programs program failure.
• Small-business decline comparative file set cannot decide a model update needs yet after a board asking if the bank should settle a matched-pair study; hold is the only Fair Lending close a mortgage company after a pricing-regression spike can defend.

Analysis required

• Check HMDA coding and underwriting policy against a model update needs.
• Compare small-business decline comparative file set to similarly situated files, second-review notes, and reason codes after a board asking if the bank should settle a matched-pair study.
• Flag any disparate-impact table CRA strategist cannot explain from small-business decline comparative file set.
• For this Fair Lending CRA and Special-Purpose Programs file, read small-business decline comparative file set against a board asking if the bank should settle a matched-pair study and write the one fact that would move a model update needs for CRA strategist.

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