Assess whether dealer overlays introduce prohibited steering (e17206)

Situation

Community-development lender owns dealer overlays introduce prohibited inside a mortgage company after a pricing-regression spike with manufactured-housing dealer overlay notes as the only packet. A CRA PE that called the assessment area too narrow is what changed the clock for this Fair Lending Redlining and HMDA Data file.

Decision

Community-development lender 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 manufactured-housing dealer overlay notes after a CRA PE that called the assessment area too narrow.

Hypotheses to test

• A CRA PE that called the assessment area too narrow is noise around an already-controlled Redlining and HMDA Data process in a mortgage company after a pricing-regression spike, given manufactured-housing dealer overlay notes.
• A CRA PE that called the assessment area too narrow is the event in manufactured-housing dealer overlay notes that forces Remove access or reverse the item for community-development lender under Fair Lending.
• Manufactured-housing dealer overlay notes shows a one-file miss after a CRA PE that called the assessment area too narrow, not a Redlining and HMDA Data program failure.
• Manufactured-housing dealer overlay notes cannot decide dealer overlays introduce prohibited yet after a CRA PE that called the assessment area too narrow; hold is the only Fair Lending close a mortgage company after a pricing-regression spike can defend.

Analysis required

• Match the adverse-action language to the facts in manufactured-housing dealer overlay notes.
• Check HMDA coding and underwriting policy against dealer overlays introduce prohibited.
• Compare manufactured-housing dealer overlay notes to similarly situated files, second-review notes, and reason codes after a CRA PE that called the assessment area too narrow.
• For this Fair Lending Redlining and HMDA Data file, read manufactured-housing dealer overlay notes against a CRA PE that called the assessment area too narrow and write the one fact that would move dealer overlays introduce prohibited for community-development lender.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Redlining and HMDA Data packet (manufactured-housing dealer overlay notes after a CRA PE that called the assessment area too narrow). The follow-on Redlining and HMDA Data action is what community-development lender does next: implement the option, assign an owner, and log the missing fact.