Assess whether a model update needs a fair-lending revalidation (c941a6)

Situation

The desk packet is appraisal-gap outcomes in majority-minority tracts after a marketing mailer that skipped majority-minority tracts. Model-risk partner for credit scoring in a credit-card issuer changing line-assignment logic has to name Remove access or reverse the item or Temporary compensating control for this Fair Lending CRA and Special-Purpose Programs file.

Decision

Model-risk partner for credit scoring 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 appraisal-gap outcomes in majority-minority tracts after a marketing mailer that skipped majority-minority tracts.

Hypotheses to test

• The population in appraisal-gap outcomes in majority-minority tracts is the one a marketing mailer that skipped majority-minority tracts named, so Remove access or reverse the item follows for this CRA and Special-Purpose Programs file.
• The population in appraisal-gap outcomes in majority-minority tracts is adjacent only to a marketing mailer that skipped majority-minority tracts; Temporary compensating control is the honest Fair Lending call.
• A credit-card issuer changing line-assignment logic already contained a marketing mailer that skipped majority-minority tracts before appraisal-gap outcomes in majority-minority tracts arrived; no new CRA and Special-Purpose Programs path.
• Provenance on appraisal-gap outcomes in majority-minority tracts after a marketing mailer that skipped majority-minority tracts is broken; do not pick Remove access or reverse the item or Temporary compensating control yet.

Analysis required

• Match the adverse-action language to the facts in appraisal-gap outcomes in majority-minority tracts.
• Check HMDA coding and underwriting policy against a model update needs.
• Compare appraisal-gap outcomes in majority-minority tracts to similarly situated files, second-review notes, and reason codes after a marketing mailer that skipped majority-minority tracts.
• For this Fair Lending CRA and Special-Purpose Programs file, read appraisal-gap outcomes in majority-minority tracts against a marketing mailer that skipped majority-minority tracts and write the one fact that would move a model update needs for model-risk partner for credit scoring.