Trellance Announces New Fair Lending Solution to Prepare Credit Unions for Audits

The NCUA has made it clear their auditors will be asking questions about fair lending practices this year – the Trellance Fair Lending Solution helps credit unions to be prepared

Trellance today announced their Fair Lending Solution, designed to help credit unions identify potential issues prior to audits and prepare to answer auditors’ questions accordingly.

The Solution reviews credit union data and identifies potential instances of:

• Disparate treatment by reviewing for notation of explicitly considered prohibited factors affecting protected ages, races and genders.

• Redlining by geocoding credit unions’ loan portfolios and mapping them against underserved zip codes.

• Disparate impact by analyzing credit union practices and testing the impact of otherwise neutral policies that disproportionately impact persons of protected classes.

Once identified, credit unions can use the software to determine if bias factored into the final lending decision, or if there were other factors at play. Identifying these instances before an audit can help credit unions to ensure they are prepared for auditor questions as they arise. Additionally, the Trellance solution reviews all levels of a credit union’s lending portfolio, not just the mortgage portfolio. The Trellance solution uses Bayesian Improved Surname Geocoding to identify the race of applicants, even when such data is unable to be collected on application forms.

“We know that credit unions strive to treat every member fairly,” said Dan Price, VP of Lending & Regulatory Analytics at Trellance. “But publicly available data, that doesn’t include context and other contributing factors, tends to create an image of bias. We built the Fair Lending Solution so that credit unions can identify trends and add context where the raw data doesn’t tell the whole story.”

Fair lending is a NCUA 2024 Supervisory Priority. Trellance’s Fair Lending Solution is now available.