Consumer Financial Protection Bureau Outlines Options To Prevent Algorithmic Bias In Home Valuations
The CFPB recently released potential options for regulating automated valuation models for home appraisals. Under Dodd-Frank, the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) was amended to include requirements that automated valuation models meet certain quality control standards. The proposed rules are intended to implement these standards and ensure that automated valuation models do not reflect existing biases in appraisal processes among other things. The rulemaking options outlined by the CFPB are now being examined to determine their potential impact on small businesses as a part of a required review process.
CFPB
February 2022