Assess whether dealer overlays introduce prohibited steering (3ebf1f)

Situation

In a credit union rolling out a special-purpose credit program, SPCP written plan versus actual originations is the evidence after a DOJ or CFPB monitor request for pricing files. Second-review underwriter has to pick Remove access or reverse the item or Temporary compensating control for this Fair Lending Examination and Notices close using SPCP written plan versus actual originations.

Decision

Second-review underwriter 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 SPCP written plan versus actual originations after a DOJ or CFPB monitor request for pricing files.

Hypotheses to test

• A DOJ or CFPB monitor request for pricing files is noise around an already-controlled Examination and Notices process in a credit union rolling out a special-purpose credit program, given SPCP written plan versus actual originations.
• A DOJ or CFPB monitor request for pricing files is the event in SPCP written plan versus actual originations that forces Remove access or reverse the item for second-review underwriter under Fair Lending.
• SPCP written plan versus actual originations shows a one-file miss after a DOJ or CFPB monitor request for pricing files, not a Examination and Notices program failure.
• SPCP written plan versus actual originations cannot decide dealer overlays introduce prohibited yet after a DOJ or CFPB monitor request for pricing files; hold is the only Fair Lending close a credit union rolling out a special-purpose credit program can defend.

Analysis required

• Test a documented exception versus a pattern a credit union rolling out a special-purpose credit program must defend.
• Match the adverse-action language to the facts in SPCP written plan versus actual originations.
• Check HMDA coding and underwriting policy against dealer overlays introduce prohibited.
• For this Fair Lending Examination and Notices file, read SPCP written plan versus actual originations against a DOJ or CFPB monitor request for pricing files and write the one fact that would move dealer overlays introduce prohibited for second-review underwriter.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Examination and Notices packet (SPCP written plan versus actual originations after a DOJ or CFPB monitor request for pricing files). The follow-on Examination and Notices action is what second-review underwriter does next: implement the option, assign an owner, and log the missing fact.