Assess whether line assignments have a disparate impact the bank will defend

Situation

Redlining and HMDA Data work in a credit union rolling out a special-purpose credit program now turns on line assignments have a because an underwriter chat that used coded language put manufactured-housing dealer overlay notes in play. Model-risk partner for credit scoring should say what manufactured-housing dealer overlay notes proves.

Decision

Model-risk partner for credit scoring in a credit union rolling out a special-purpose credit program must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using manufactured-housing dealer overlay notes after an underwriter chat that used coded language.

Hypotheses to test

• The population in manufactured-housing dealer overlay notes is the one an underwriter chat that used coded language named, so Remove access or reverse the item follows for this Redlining and HMDA Data file.
• The population in manufactured-housing dealer overlay notes is adjacent only to an underwriter chat that used coded language; Temporary compensating control is the honest Fair Lending call.
• A credit union rolling out a special-purpose credit program already contained an underwriter chat that used coded language before manufactured-housing dealer overlay notes arrived; no new Redlining and HMDA Data path.
• Provenance on manufactured-housing dealer overlay notes after an underwriter chat that used coded language is broken; do not pick Remove access or reverse the item or Temporary compensating control yet.

Analysis required

• Compare manufactured-housing dealer overlay notes to similarly situated files, second-review notes, and reason codes after an underwriter chat that used coded language.
• Flag any disparate-impact table model-risk partner for credit scoring cannot explain from manufactured-housing dealer overlay notes.
• Test a documented exception versus a pattern a credit union rolling out a special-purpose credit program must defend.
• For this Fair Lending Redlining and HMDA Data file, read manufactured-housing dealer overlay notes against an underwriter chat that used coded language and write the one fact that would move line assignments have a for model-risk partner for credit scoring.

Recommendation