Assess whether a model update needs a fair-lending revalidation (2f5050)

Situation

A mortgage company after a pricing-regression spike cannot treat a DOJ or CFPB monitor request for pricing files as color commentary on geographic application and origination heat map. Exam-response coordinator must close a model update needs from that extract under Fair Lending / Examination and Notices.

Decision

Exam-response coordinator 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 geographic application and origination heat map after a DOJ or CFPB monitor request for pricing files.

Hypotheses to test

• The population in geographic application and origination heat map is the one a DOJ or CFPB monitor request for pricing files named, so Remove access or reverse the item follows for this Examination and Notices file.
• The population in geographic application and origination heat map is adjacent only to a DOJ or CFPB monitor request for pricing files; Temporary compensating control is the honest Fair Lending call.
• A mortgage company after a pricing-regression spike already contained a DOJ or CFPB monitor request for pricing files before geographic application and origination heat map arrived; no new Examination and Notices path.
• Provenance on geographic application and origination heat map after a DOJ or CFPB monitor request for pricing files is broken; do not pick Remove access or reverse the item or Temporary compensating control yet.

Analysis required

• Check HMDA coding and underwriting policy against a model update needs.
• Compare geographic application and origination heat map to similarly situated files, second-review notes, and reason codes after a DOJ or CFPB monitor request for pricing files.
• Flag any disparate-impact table exam-response coordinator cannot explain from geographic application and origination heat map.
• For this Fair Lending Examination and Notices file, read geographic application and origination heat map against a DOJ or CFPB monitor request for pricing files and write the one fact that would move a model update needs for exam-response coordinator.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Examination and Notices packet (geographic application and origination heat map after a DOJ or CFPB monitor request for pricing files). If geographic application and origination heat map cannot force a Fair Lending label under Examination and Notices, stop. If geographic application and origination heat map after a DOJ or CFPB monitor request for pricing files cannot support Remove access or reverse the item versus Temporary compensating control on this Fair Lending Examination and Notices close, exam-response coordinator must do not infer a control or scheme beyond the transaction and entitlement evidence.