Hot Topics Guidance from the Experts

Each of the three Virtual Conferences starts with a hot topics session highlighting the current environment and areas we all need to pay attention to.

In the Virtual Lending Conference, Jerod discussed using automated valuation models (AVMs) for credit decisions and the new regulatory requirements (not guidance) that go along with using them. The key points are:

• Institutions must implement quality control standards for the use of AVMs to ensure credibility and integrity.
• The AVM rule applies to both consumer and commercial loans and is specified in regulations from various federal agencies, including the Consumer Financial Protection Bureau.
• AVMs are defined as computerized models used to determine the value of a consumer's principal dwelling.
• The effective date for compliance with the AVM rule is October 1, 2025, giving institutions 12 months to prepare.

In the Virtual Lending Conference, Jerod discussed the regulatory requirements for financial institutions to have a firewall to protect prohibited basis information collected as part of the 1071 data collection. The key points are:

• Financial institutions are required to have a firewall and are not exempt from this requirement. Some employees may be exempt.
• The firewall prohibits access to the 1071 data (information on women-owned, minority-owned, LGBTQI+, and demographic characteristics) by those involved in making loan-related determinations.
• The purpose of the firewall is to prevent the prohibited basis information from being used for anything other than the 1071 data collection, as required by fair lending laws.

We close out the 2024 Virtual Conference series with the Virtual BSA/AML Conference. Get your Team in and check out the hot topics. Better yet, get your Team access to the entire series; one Registration Gets Your Whole Team Trained.

Published
2024/10/31