Wolters Kluwer Enhances Fair Lending Solution
MINNEAPOLIS — Wolters Kluwer Financial Services announced this week that its Fair Lending Wiz software now includes an ethnicity proxy functionality.
Management explained the enhancement can allow financial institutions to make a determination of whether a loan applicant is Hispanic when this race information is not available in the loan file.
Wolters Kluwer noted the complete solution can help organizations comply with fair lending requirements tied to auto, mortgage, consumer and small business loans that are originated directly or through third-party channels. The solution can provide institutions with comprehensive analytical tools that allow them to easily identify potential risks and quickly take corrective action to remedy unfair lending practices.
Executives went on to highlight the new feature should further extend the solution's current ability to provide gender and minority proxies. They stressed these proxies can help improve the quality of Home Mortgage Disclosure Act loan data to detect potential problems that may contribute to discriminatory loans.
Wolters Kluwer believes underwriting fair and non-discriminatory loans is more important for financial services organizations than ever before. The company recapped a recent speech Thomas Perez, assistant attorney general for the Department of Justice's Civil Rights Division.
Perez told The Brookings Institution in late June that the DOJ is investigating 18 lenders for potential fair lending violations. Perez also noted his department is collaborating with the Department of Housing and Urban Development to ensure Federal Housing Administration loans are free of predatory and discriminatory lending practices.
Furthermore, Perez pointed out the DOJ is working with states' attorneys general on a more widespread basis to provide support to their investigations of fair lending violations.
Wolters Kluwer reiterated that its Fair Lending Wiz software can assist lenders in effectively monitoring against a variety of potential fair lending concerns, including redlining, reverse redlining, steering, disparate treatment and disparate impact.
"We continue to strengthen our Fair Lending Wiz solution to help our customers address regulators' intensified scrutiny of their lending practices," stated Heather Czermak, chief product manager for Wolters Kluwer's consumer compliance business.
"A perfect example is the solution's advanced analysis capabilities that help lenders effectively identify potential compliance problems that could result in disparate treatment," she continued.
Czermak added that the current administration's focus on this more challenging method of fair lending analysis, in addition to other fair lending concerns, makes it an area of compliance lenders need to address thoroughly.
To demonstrate further how the Fair Lending Wiz is intended to operate, Wolters Kluwer scheduled a free Webcast for July 27. The hour-long session is scheduled to begin at 2 p.m. Registration can be completed here.