Assess whether pricing disparities are justified by legitimate factors

SITUATION A branch that stopped taking applications in one ZIP put adverse-action notice principal-reason sample in front of adverse-action notice operations lead in a lender expanding into majority-minority census tracts. This Fair Lending / Redlining and HMDA Data close is pricing disparities are justified from adverse-action notice principal-reason sample, 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 lender expanding into majority-minority census tracts must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using adverse-action notice principal-reason sample after a branch that stopped taking applications in one ZIP.

HYPOTHESES TO TEST 1. Authorize Remove access or reverse the item now; adverse-action notice principal-reason sample already has the discriminator after a branch that stopped taking applications in one ZIP. 2. Keep Temporary compensating control in force until adverse-action notice principal-reason sample is completed after a branch that stopped taking applications in one ZIP for adverse-action notice operations lead. 3. Treat adverse-action notice principal-reason sample as Approve a documented exception because both readings appear after a branch that stopped taking applications in one ZIP. 4. Refuse a Fair Lending close: adverse-action notice operations lead does not have the decision pricing disparities are justified turns on in adverse-action notice principal-reason sample.

ANALYSIS REQUIRED 1. Compare adverse-action notice principal-reason sample to similarly situated files, second-review notes, and reason codes after a branch that stopped taking applications in one ZIP. 2. Flag any disparate-impact table adverse-action notice operations lead cannot explain from adverse-action notice principal-reason sample. 3. Test a documented exception versus a pattern a lender expanding into majority-minority census tracts must defend. 4. For this Fair Lending Redlining and HMDA Data file, read adverse-action notice principal-reason sample against a branch that stopped taking applications in one ZIP and write the one fact that would move pricing disparities are justified for adverse-action notice operations lead.

RECOMMENDATION Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Redlining and HMDA Data packet (adverse-action notice principal-reason sample after a branch that stopped taking applications in one ZIP). Lead with the Fair Lending option adverse-action notice principal-reason sample can support after a branch that stopped taking applications in one ZIP, then the two facts that force it, then the Monday action for adverse-action notice operations lead in a lender expanding into majority-minority census tracts.