Whether HMDA data can be relied on for the exam from adverse-action notice

Situation

In a bank with thin HMDA LAR quality, adverse-action notice principal-reason sample is the evidence after a marketing mailer that skipped majority-minority tracts. Community-development lender has to pick Remove access or reverse the item or Temporary compensating control for this Fair Lending Pricing and Credit Limits close using adverse-action notice principal-reason sample.

Decision

Community-development lender 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 adverse-action notice principal-reason sample after a marketing mailer that skipped majority-minority tracts.

Hypotheses to test

• Community-development lender can defend Remove access or reverse the item from adverse-action notice principal-reason sample after a marketing mailer that skipped majority-minority tracts in a Fair Lending challenge.
• Community-development lender cannot defend Remove access or reverse the item from adverse-action notice principal-reason sample; Temporary compensating control is what the extract actually supports after a marketing mailer that skipped majority-minority tracts.
• A marketing mailer that skipped majority-minority tracts never reached the population in adverse-action notice principal-reason sample — reopen intake, do not close HMDA data can be relied on.
• Two facts in adverse-action notice principal-reason sample after a marketing mailer that skipped majority-minority tracts conflict for community-development lender; hold this Pricing and Credit Limits file.

Analysis required

• Match the adverse-action language to the facts in adverse-action notice principal-reason sample.
• Check HMDA coding and underwriting policy against HMDA data can be relied on.
• Compare adverse-action notice principal-reason sample to similarly situated files, second-review notes, and reason codes after a marketing mailer that skipped majority-minority tracts.
• For this Fair Lending Pricing and Credit Limits file, read adverse-action notice principal-reason sample against a marketing mailer that skipped majority-minority tracts and write the one fact that would move HMDA data can be relied on for community-development lender.

Recommendation