Model-risk partner for credit scoring must resolve whether dealer overlays

Situation

A small-business desk using a new vendor score cannot treat a SPCP that originated almost no loans to the intended class as color commentary on model-reason-code mapping that does not match notices. Model-risk partner for credit scoring must close dealer overlays introduce prohibited from that extract under Fair Lending / Pricing and Credit Limits.

Decision

Model-risk partner for credit scoring in a small-business desk using a new vendor score must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using model-reason-code mapping that does not match notices after a SPCP that originated almost no loans to the intended class.

Hypotheses to test

• The population in model-reason-code mapping that does not match notices is the one a SPCP that originated almost no loans to the intended class named, so Remove access or reverse the item follows for this Pricing and Credit Limits file.
• The population in model-reason-code mapping that does not match notices is adjacent only to a SPCP that originated almost no loans to the intended class; Temporary compensating control is the honest Fair Lending call.
• A small-business desk using a new vendor score already contained a SPCP that originated almost no loans to the intended class before model-reason-code mapping that does not match notices arrived; no new Pricing and Credit Limits path.
• Provenance on model-reason-code mapping that does not match notices after a SPCP that originated almost no loans to the intended class 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 model-reason-code mapping that does not match notices.
• Check HMDA coding and underwriting policy against dealer overlays introduce prohibited.
• Compare model-reason-code mapping that does not match notices to similarly situated files, second-review notes, and reason codes after a SPCP that originated almost no loans to the intended class.
• For this Fair Lending Pricing and Credit Limits file, read model-reason-code mapping that does not match notices against a SPCP that originated almost no loans to the intended class and write the one fact that would move dealer overlays introduce prohibited for model-risk partner for credit scoring.