Fair Lending Risk Assessment

Fair Lending Risk Assessment Process

After determining an institution’s focal points, Preiss&Associates performs a fair lending risk assessment on those focal points that appear to be potentially problematic from a credit decision, pricing decision or other perspective. The risk assessment will determine whether or not additional analysis such as regression analysis is needed. Fair lending risk assessments most frequently are performed for credit decisions as well as pricing decisions by race, gender and ethnicity. Other types of risk assessments, as detailed in the Fair Lending Exam Procedures, may also be performed depending on the individual circumstances of the institution.

Fair Lending Risk Applications

  • Risk assessment is a tool to monitor fair lending risk
  • Complexity of risk assessment is dependent on the products/services of the institution’s business

Benefits of our Fair Lending Risk Assessment

  • Regulators strongly suggest banks perform risk assessments
  • Bank determines where its fair lending risks lie before the regulators tell them
  • Allows an opportunity to fix fair lending risk issues
  • Positions bank for better ratings on fair lending compliance exams

For more information on the fair lending risk assessment, and a full discussion of your requirements, please contact us here.