Assess whether a model update needs a fair-lending revalidation (61e92d)

Situation

A mortgage company after a pricing-regression spike cannot treat a board asking if the bank should settle a matched-pair study as color commentary on SPCP written plan versus actual originations. Community-development lender must close a model update needs from that extract under Fair Lending / Redlining and HMDA Data.

Decision

Community-development lender 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 SPCP written plan versus actual originations 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 Redlining and HMDA Data process in a mortgage company after a pricing-regression spike, given SPCP written plan versus actual originations.
• A board asking if the bank should settle a matched-pair study is the event in SPCP written plan versus actual originations that forces Remove access or reverse the item for community-development lender under Fair Lending.
• SPCP written plan versus actual originations shows a one-file miss after a board asking if the bank should settle a matched-pair study, not a Redlining and HMDA Data program failure.
• SPCP written plan versus actual originations 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

• Compare SPCP written plan versus actual originations 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 community-development lender cannot explain from SPCP written plan versus actual originations.
• Test a documented exception versus a pattern a mortgage company after a pricing-regression spike must defend.
• For this Fair Lending Redlining and HMDA Data file, read SPCP written plan versus actual originations 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 community-development lender.

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