Assess whether HMDA data can be relied on for the exam (839249)

Situation

The Examination and Notices desk packet is CRA assessment-area versus lending footprint after an underwriter chat that used coded language. Adverse-action notice operations lead in a credit-card issuer changing line-assignment logic must name Remove access or reverse the item or Temporary compensating control for this Fair Lending file. Adverse-action notice operations lead in a credit-card issuer changing line-assignment logic has to name Remove access or reverse the item or Temporary compensating control for this Fair Lending Examination and Notices file.

Decision

Adverse-action notice operations lead in a credit-card issuer changing line-assignment logic must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using CRA assessment-area versus lending footprint after an underwriter chat that used coded language.

Hypotheses to test

• CRA assessment-area versus lending footprint reads as Remove access or reverse the item once an underwriter chat that used coded language is lined up to the same Fair Lending population.
• CRA assessment-area versus lending footprint is closer to Temporary compensating control after an underwriter chat that used coded language; Remove access or reverse the item would over-claim this Examination and Notices extract.
• Approve a documented exception is still live in CRA assessment-area versus lending footprint for adverse-action notice operations lead in a credit-card issuer changing line-assignment logic.
• CRA assessment-area versus lending footprint is missing the fact adverse-action notice operations lead needs after an underwriter chat that used coded language; stop this Fair Lending close.

Analysis required

• Match the adverse-action language to the facts in CRA assessment-area versus lending footprint.
• Check HMDA coding and underwriting policy against HMDA data can be relied on.
• Compare CRA assessment-area versus lending footprint to similarly situated files, second-review notes, and reason codes after an underwriter chat that used coded language.
• For this Fair Lending Examination and Notices file, read CRA assessment-area versus lending footprint against an underwriter chat that used coded language and write the one fact that would move HMDA data can be relied on for adverse-action notice operations lead.