Regulates use of artificial intelligence in certain mortgage lending tools to minimize discrimination in lending.
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed General Assembly
- Passed Senate
- To Governor
- Became Law
Overview
This bill aims to prevent discrimination in mortgage lending by regulating how artificial intelligence (AI) tools are used. It requires lenders in New Jersey to ensure that AI tools used in mortgage applications do not unfairly disadvantage applicants based on protected characteristics like race, ethnicity, or gender. The bill establishes guidelines for the development and implementation of these AI tools, focusing on transparency and fairness. It also mandates ongoing monitoring and audits to detect and correct any discriminatory outcomes.
Key provisions
- Requires lenders to disclose when AI tools are used in mortgage applications.
- Establishes standards for the accuracy and fairness of AI algorithms.
- Mandates ongoing monitoring of AI tools to identify and mitigate bias.
- Requires lenders to conduct regular audits of their AI systems.
- Creates a process for applicants to challenge decisions made with the assistance of AI.
- Defines ‘protected characteristics’ for the purposes of anti-discrimination.
- Requires lenders to provide training to employees on the use of AI tools and potential biases.
Who is affected
- Mortgage lenders in New Jersey
- Applicants seeking mortgages in New Jersey
- Financial institutions operating in New Jersey
- Consumers seeking housing loans
- Fair Housing organizations
Notable changes
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1 on record
Primary sponsor
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