Assess whether dealer overlays introduce prohibited steering (730582)

Situation

In a credit union rolling out a special-purpose credit program, underwriting exception log by branch is the evidence after an exception rate twice as high for one group after credit controls. HMDA data-quality manager has to pick Remove access or reverse the item or Temporary compensating control for this Fair Lending CRA and Special-Purpose Programs close using underwriting exception log by branch.

Decision

HMDA data-quality manager 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 underwriting exception log by branch after an exception rate twice as high for one group after credit controls.

Hypotheses to test

• An exception rate twice as high for one group after credit controls is noise around an already-controlled CRA and Special-Purpose Programs process in a credit union rolling out a special-purpose credit program, given underwriting exception log by branch.
• An exception rate twice as high for one group after credit controls is the event in underwriting exception log by branch that forces Remove access or reverse the item for HMDA data-quality manager under Fair Lending.
• Underwriting exception log by branch shows a one-file miss after an exception rate twice as high for one group after credit controls, not a CRA and Special-Purpose Programs program failure.
• Underwriting exception log by branch cannot decide dealer overlays introduce prohibited yet after an exception rate twice as high for one group after credit controls; hold is the only Fair Lending close a credit union rolling out a special-purpose credit program can defend.

Analysis required

• Match the adverse-action language to the facts in underwriting exception log by branch.
• Check HMDA coding and underwriting policy against dealer overlays introduce prohibited.
• Compare underwriting exception log by branch to similarly situated files, second-review notes, and reason codes after an exception rate twice as high for one group after credit controls.
• For this Fair Lending CRA and Special-Purpose Programs file, read underwriting exception log by branch against an exception rate twice as high for one group after credit controls and write the one fact that would move dealer overlays introduce prohibited for HMDA data-quality manager.