Assess whether pricing disparities are justified by legitimate factors

SITUATION The working file is geographic application and origination heat map after an exception rate twice as high for one group after credit controls. CRA strategist in a mortgage company after a pricing-regression spike has to name Remove access or reverse the item or Temporary compensating control for this Fair Lending CRA and Special-Purpose Programs file.

DECISION CRA strategist in a mortgage company after a pricing-regression spike must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using geographic application and origination heat map after an exception rate twice as high for one group after credit controls.

HYPOTHESES TO TEST 1. An exception rate twice as high for one group after credit controls is noise around an already-controlled CRA and Special-Purpose Programs process in a mortgage company after a pricing-regression spike, given geographic application and origination heat map. 2. An exception rate twice as high for one group after credit controls is the event in geographic application and origination heat map that forces Remove access or reverse the item for CRA strategist under Fair Lending. 3. Geographic application and origination heat map shows a one-file miss after an exception rate twice as high for one group after credit controls, not a CRA and Special-Purpose Programs program failure. 4. Geographic application and origination heat map cannot decide pricing disparities are justified yet after an exception rate twice as high for one group after credit controls; hold is the only Fair Lending close a mortgage company after a pricing-regression spike can defend.

ANALYSIS REQUIRED 1. Check HMDA coding and underwriting policy against pricing disparities are justified. 2. Compare geographic application and origination heat map to similarly situated files, second-review notes, and reason codes after an exception rate twice as high for one group after credit controls. 3. Flag any disparate-impact table CRA strategist cannot explain from geographic application and origination heat map. 4. For this Fair Lending CRA and Special-Purpose Programs file, read geographic application and origination heat map against an exception rate twice as high for one group after credit controls and write the one fact that would move pricing disparities are justified for CRA strategist.

RECOMMENDATION Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / CRA and Special-Purpose Programs packet (geographic application and origination heat map after an exception rate twice as high for one group after credit controls). The follow-on CRA and Special-Purpose Programs action is what CRA strategist does next: implement the option, assign an owner, and log the missing fact.