Adverse-action notice operations lead must resolve whether dealer overlays

Situation

A community complaint about appraisal gaps put geographic application and origination heat map in front of adverse-action notice operations lead in a credit union rolling out a special-purpose credit program. This Fair Lending / Pricing and Credit Limits close is dealer overlays introduce prohibited from geographic application and origination heat map, and the live options are Remove access or reverse the item, Temporary compensating control, Approve a documented exception.

Decision

Adverse-action notice operations lead in a credit union rolling out a special-purpose credit program must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using geographic application and origination heat map after a community complaint about appraisal gaps.

Hypotheses to test

• Geographic application and origination heat map reads as Remove access or reverse the item once a community complaint about appraisal gaps is lined up to the same Fair Lending population.
• Geographic application and origination heat map is closer to Temporary compensating control after a community complaint about appraisal gaps; Remove access or reverse the item would over-claim this Pricing and Credit Limits extract.
• Approve a documented exception is still live in geographic application and origination heat map for adverse-action notice operations lead in a credit union rolling out a special-purpose credit program.
• Geographic application and origination heat map is missing the fact adverse-action notice operations lead needs after a community complaint about appraisal gaps; stop this Fair Lending close.

Analysis required

• Match the adverse-action language to the facts in geographic application and origination heat map.
• Check HMDA coding and underwriting policy against dealer overlays introduce prohibited.
• Compare geographic application and origination heat map to similarly situated files, second-review notes, and reason codes after a community complaint about appraisal gaps.
• For this Fair Lending Pricing and Credit Limits file, read geographic application and origination heat map against a community complaint about appraisal gaps and write the one fact that would move dealer overlays introduce prohibited for adverse-action notice operations lead.