Assess whether comparative files show second-review bias from CRA

SITUATION Fair-lending officer at a mortgage company after a pricing-regression spike is reviewing CRA assessment-area versus lending footprint after a SPCP that originated almost no loans to the intended class. The question on that extract is whether comparative files show second-review bias. The packet does not yet prove Remove access or reverse the item versus Temporary compensating control.

DECISION Fair-lending officer 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 CRA assessment-area versus lending footprint after a SPCP that originated almost no loans to the intended class.

HYPOTHESES TO TEST 1. CRA assessment-area versus lending footprint reads as Remove access or reverse the item once a SPCP that originated almost no loans to the intended class is lined up to the same Fair Lending population. 2. CRA assessment-area versus lending footprint is closer to Temporary compensating control after a SPCP that originated almost no loans to the intended class; Remove access or reverse the item would over-claim this Pricing and Credit Limits extract. 3. Approve a documented exception is still live in CRA assessment-area versus lending footprint for fair-lending officer in a mortgage company after a pricing-regression spike. 4. CRA assessment-area versus lending footprint is missing the fact fair-lending officer needs after a SPCP that originated almost no loans to the intended class; stop this Fair Lending close.

ANALYSIS REQUIRED 1. Test a documented exception versus a pattern a mortgage company after a pricing-regression spike must defend. 2. Match the adverse-action language to the facts in CRA assessment-area versus lending footprint. 3. Check HMDA coding and underwriting policy against comparative files show second-review. 4. For this Fair Lending Pricing and Credit Limits file, read CRA assessment-area versus lending footprint against a SPCP that originated almost no loans to the intended class and write the one fact that would move comparative files show second-review for fair-lending officer.

RECOMMENDATION Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Pricing and Credit Limits packet (CRA assessment-area versus lending footprint after a SPCP that originated almost no loans to the intended class). If CRA assessment-area versus lending footprint cannot force a Fair Lending label under Pricing and Credit Limits, stop. Do not invent missing evidence a mortgage company after a pricing-regression spike does not have.