Assess whether comparative files show second-review bias (524395)

Situation

A notice that cites 'other' as the principal reason 40% of the time put mortgage pricing residual by prohibited-basis group in front of second-review underwriter in a small-business desk using a new vendor score. This Fair Lending / Redlining and HMDA Data close is comparative files show second-review from mortgage pricing residual by prohibited-basis group, and the live options are Remove access or reverse the item, Temporary compensating control, Approve a documented exception.

Decision

Second-review underwriter in a small-business desk using a new vendor score must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using mortgage pricing residual by prohibited-basis group after a notice that cites 'other' as the principal reason 40% of the time.

Hypotheses to test

• Mortgage pricing residual by prohibited-basis group reads as Remove access or reverse the item once a notice that cites 'other' as the principal reason 40% of the time is lined up to the same Fair Lending population.
• Mortgage pricing residual by prohibited-basis group is closer to Temporary compensating control after a notice that cites 'other' as the principal reason 40% of the time; Remove access or reverse the item would over-claim this Redlining and HMDA Data extract.
• Approve a documented exception is still live in mortgage pricing residual by prohibited-basis group for second-review underwriter in a small-business desk using a new vendor score.
• Mortgage pricing residual by prohibited-basis group is missing the fact second-review underwriter needs after a notice that cites 'other' as the principal reason 40% of the time; stop this Fair Lending close.

Analysis required

• Compare mortgage pricing residual by prohibited-basis group to similarly situated files, second-review notes, and reason codes after a notice that cites 'other' as the principal reason 40% of the time.
• Flag any disparate-impact table second-review underwriter cannot explain from mortgage pricing residual by prohibited-basis group.
• Test a documented exception versus a pattern a small-business desk using a new vendor score must defend.
• For this Fair Lending Redlining and HMDA Data file, read mortgage pricing residual by prohibited-basis group against a notice that cites 'other' as the principal reason 40% of the time and write the one fact that would move comparative files show second-review for second-review underwriter.