What Regulation B requires — and how Lendiro's output supports it
The Equal Credit Opportunity Act and Regulation B impose specific obligations on lenders when taking adverse action on credit applications. Using a third-party API does not transfer those obligations — the lender remains responsible.
Adverse action notice requirements
Lenders must provide specific written notice when taking adverse action, including the principal reasons for the decision. Lendiro's API response includes reason codes mapped to Reg B adverse action categories, which lenders can use to fulfill this requirement.
Reason statements in plain English
Each decision response includes human-readable reason statements suitable for use in adverse action notices. The /v1/adverse-action endpoint generates structured notice content from any decision ID.
Lender responsibility remains with the lender
Lendiro provides decisioning infrastructure to licensed lenders. The lender using our API is responsible for their own ECOA compliance, including reviewing reason code output before using it in consumer notices.
Examination-ready decision records
Every decision is logged with signal weights, reason codes, model version, and timestamp. Export in structured format for regulatory examination or internal audit. Lenders can retain audit logs in their own systems via webhook.
Important: The content on this page describes how Lendiro's API output is designed to support lender compliance workflows. It does not constitute legal advice. Lenders are responsible for their own ECOA and fair lending compliance programs. Consult your compliance counsel regarding specific regulatory obligations.
Fair lending and alternative data — the nuanced picture
Signal design and disparate impact
Not all cash-flow signals have equal fair lending implications. Lendiro's signal selection was designed with disparate impact in mind — we specifically avoid signals that function as proxies for protected class status without independent predictive value.
Income consistency, expense discipline, liquidity cushion, and payment reliability were selected because they show consistently lower disparate-impact ratios compared to FICO scores on thin-file populations in published academic and industry research. This does not mean zero disparate impact — no credit signal does.
What "monitoring built in" means
Lendiro's disparate-impact monitoring tracks approval rates, denial rates, and signal distributions across demographic proxy variables. This data is made available to lenders through the dashboard and export API. Lenders use it to conduct their own disparate-impact analysis — Lendiro provides the data infrastructure, not the compliance conclusion.
Monitoring capabilities
Every decision logged. Every reason code preserved.
Model explainability and decision transparency are the foundation of a defensible alternative-data underwriting program.
Complete decision log
Score, signals, reason codes, model version, timestamp, and applicant reference stored per decision. Retrievable via API indefinitely within your account.
Plain-English reason statements
The /v1/adverse-action endpoint generates consumer-facing reason statements from structured codes — ready for your notice workflow.
Webhook delivery to your DMS
Push decision records to your document management system via webhook at decision time. Preserve complete audit trail in your own infrastructure.
Discuss your compliance requirements
Every lender's compliance context is different. Talk to the team about your specific ECOA obligations, examination history, and what documentation your regulators expect.
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