Assess whether a model update needs a fair-lending revalidation (e93d89)

Situation

Appraisal-gap outcomes in majority-minority tracts arrived with a community complaint about appraisal gaps for fair-lending officer. That is a Fair Lending Redlining and HMDA Data decision on a model update needs in a manufactured-housing lender with dealer-originated files.

Decision

Fair-lending officer in a manufactured-housing lender with dealer-originated files 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 community complaint about appraisal gaps.

Hypotheses to test

• Fair-lending officer can defend Remove access or reverse the item from appraisal-gap outcomes in majority-minority tracts after a community complaint about appraisal gaps in a Fair Lending challenge.
• Fair-lending officer cannot defend Remove access or reverse the item from appraisal-gap outcomes in majority-minority tracts; Temporary compensating control is what the extract actually supports after a community complaint about appraisal gaps.
• A community complaint about appraisal gaps never reached the population in appraisal-gap outcomes in majority-minority tracts — reopen intake, do not close a model update needs.
• Two facts in appraisal-gap outcomes in majority-minority tracts after a community complaint about appraisal gaps conflict for fair-lending officer; hold this Redlining and HMDA Data file.

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 community complaint about appraisal gaps.
• For this Fair Lending Redlining and HMDA Data file, read appraisal-gap outcomes in majority-minority tracts against a community complaint about appraisal gaps and write the one fact that would move a model update needs for fair-lending officer.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Redlining and HMDA Data packet (appraisal-gap outcomes in majority-minority tracts after a community complaint about appraisal gaps). If appraisal-gap outcomes in majority-minority tracts cannot force a Fair Lending label under Redlining and HMDA Data, stop. If appraisal-gap outcomes in majority-minority tracts after a community complaint about appraisal gaps cannot support Remove access or reverse the item versus Temporary compensating control on this Fair Lending Redlining and HMDA Data close, fair-lending officer must do not infer a control or scheme beyond the transaction and entitlement evidence.