Assess whether comparative files show second-review bias (f05cf8)

Situation

A bank with thin HMDA LAR quality cannot treat a HMDA resubmission that still fails quality edits as color commentary on HMDA LAR validity and quality edits. Fair-lending officer must close comparative files show second-review from that extract under Fair Lending / CRA and Special-Purpose Programs.

Decision

Fair-lending officer in a bank with thin HMDA LAR quality must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using HMDA LAR validity and quality edits after a HMDA resubmission that still fails quality edits.

Hypotheses to test

• HMDA LAR validity and quality edits reads as Remove access or reverse the item once a HMDA resubmission that still fails quality edits is lined up to the same Fair Lending population.
• HMDA LAR validity and quality edits is closer to Temporary compensating control after a HMDA resubmission that still fails quality edits; Remove access or reverse the item would over-claim this CRA and Special-Purpose Programs extract.
• Approve a documented exception is still live in HMDA LAR validity and quality edits for fair-lending officer in a bank with thin HMDA LAR quality.
• HMDA LAR validity and quality edits is missing the fact fair-lending officer needs after a HMDA resubmission that still fails quality edits; stop this Fair Lending close.

Analysis required

• Test a documented exception versus a pattern a bank with thin HMDA LAR quality must defend.
• Match the adverse-action language to the facts in HMDA LAR validity and quality edits.
• Check HMDA coding and underwriting policy against comparative files show second-review.
• For this Fair Lending CRA and Special-Purpose Programs file, read HMDA LAR validity and quality edits against a HMDA resubmission that still fails quality edits 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 / CRA and Special-Purpose Programs packet (HMDA LAR validity and quality edits after a HMDA resubmission that still fails quality edits). Lead with the Fair Lending option HMDA LAR validity and quality edits can support after a HMDA resubmission that still fails quality edits, then the two facts that force it, then the Monday action for fair-lending officer in a bank with thin HMDA LAR quality.