How Our Software Can Help

Self Testing for Fair Lending

Be Prepared by Self-Testing

By self-testing for discrimination and taking corrective action you can avoid a negative fair lending exam from the federal regulators.

Third Party Lenders

Spend Less Time Worrying About Third Party Lending

Letting third parties represent your company has pros and cons. One of the cons in the case with Fair Lending is that you can be held responsible for their mistakes. By analyzing your vendors, auto dealers, branches, loan officers, etc. you can spend less time worrying about how you're being represented and more time on growing your business.

Quantify Undewriting Guidelines

Quantify The Fairness of Your Underwriting Guidelines

Rest easy knowing that your guidelines are accurately assessing an applicant based solely on their credit worthiness and nothing else.

Fair Lending Litigation

Protect Yourself From Litigation

Get ahead of the game by avoiding the fines and litigation that comes from regulators finding disparate impact in your lending practices.

Stay ahead of regulations

Stay in Front of Changing Regulations

Regulations are constantly changing. Five years ago few institutions were worried about Fair Lending Examinations, today it's talked about in almost every conference. By better understanding the demographics of your loan portfolio, you'll be better prepared to deal with future changes.

Pricing Anomalies in Fair Lending Analysis

Don't Get Caught Off Guard from Pricing Anomalies

Too often underwriting pricing problems are caught after many people have been affected. By continually monitoring your loan portfolio for discrepancies you'll be able to identify any problems before they become a larger issue.

So, what does our Fair Lending Software do?

Pricing Discrimination Features

  • test   Test pricing on race, age, gender
  • compare pricing   Compare actual vs expected pricing
  • charts   Know the statistical relevancy of differences found
  • Analyze Third Parties   Analyze auto dealers, loan officers, branches, etc.

Steering Features

  • PBG Trends   Monitor trends of products by prohibited basis group (PBG)
  • Product Type Concentrations   Analyze your concentrations of borrowers in each product type
  • Analyze Steering   Analyze each PBG by loan type in relation to your steering ratio
  • Monitor percent   Monitor the percent of total assets each group makes up

We could go on and on about all of the great Fair Lending features but we think it's probably more helpful to see for yourself.

The video below is a presentation we gave at Finovate about the pricing discrimination portion of our software. The other presentation is a webinar we gave in August 2014 about fair lending. Enjoy!

The Pro-Active Approach to Fair Lending

Why self-test?

Although most institutions do not intentionally discriminate, regulatory agencies now ask institutions to take a proactive approach by testing for disparate impact within the portfolio.

The Equal Credit Opportunity Act (ECOA), implemented by Regulation B (12 CFR 1002), promotes availability of credit to all creditworthy applicants without regard to race, color, religion, national origin, sex, marital status, or age. The problem most institutions face is how will they prove they are not discriminating.

How do you know if one of your auto dealers is discriminating, or a loan officer, or a branch? Collecting and analyzing data is the answer. The beauty of a data approach is that it presents un-biased facts.

To address this problem, Visible Equity created its Fair Lending Software.

Ok so...who regulates whom?

THe CFPB supervises banks and credit unions with more than $10 billion in assets. The NCUA supervises federal credit unions with less than $10 billion in assets, and the OCC, FDIC or the Fed enforce fair lending laws against banks under $10 billion. State regulators oversee state-chartered credit unions with less than $10 billion in assets. The CFPB also has enforcement authority over non-bank lenders of all types and sizes (other than most car dealers).

The CFPB, FDIC, and NCUA have released specific guides on how they perform a fair lending examination and can be read in the following links.


Can I wait until I get examined?

The advantage of self-testing is that you can take corrective action ahead of time. Self-testing and corrective action are the tools to avoid fines and litigation that can accompany a Fair Lending Examination if violations are found. The CFPB & NCUA have litigating authority and can file cases in federal court alleging violations of fair lending laws.

The CFPB, FDIC, & NCUA also report findings to the Department of Justice (DOJ) or U.S. Department of Housing and Urban Development (HUD). Regulation B provides for actual damages, as well as for punitive damages of up to $10,000 in individual lawsuits and up to the lesser of $500,000 or one percent of the institution’s net worth in class action suits. Court costs and reasonable attorney fees may also be awarded to an aggrieved applicant in a successful action.