Assess whether HMDA data can be relied on for the exam (b74e25)

Situation

A manufactured-housing lender with dealer-originated files cannot treat a notice that cites 'other' as the principal reason 40% of the time as color commentary on credit-card limit assignment disparity table. Exam-response coordinator must close HMDA data can be relied on from that extract under Fair Lending / CRA and Special-Purpose Programs.

Decision

Exam-response coordinator in a manufactured-housing lender with dealer-originated files must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using credit-card limit assignment disparity table after a notice that cites 'other' as the principal reason 40% of the time.

Hypotheses to test

• Exam-response coordinator can defend Remove access or reverse the item from credit-card limit assignment disparity table after a notice that cites 'other' as the principal reason 40% of the time in a Fair Lending challenge.
• Exam-response coordinator cannot defend Remove access or reverse the item from credit-card limit assignment disparity table; Temporary compensating control is what the extract actually supports after a notice that cites 'other' as the principal reason 40% of the time.
• A notice that cites 'other' as the principal reason 40% of the time never reached the population in credit-card limit assignment disparity table — reopen intake, do not close HMDA data can be relied on.
• Two facts in credit-card limit assignment disparity table after a notice that cites 'other' as the principal reason 40% of the time conflict for exam-response coordinator; hold this CRA and Special-Purpose Programs file.

Analysis required

• Test a documented exception versus a pattern a manufactured-housing lender with dealer-originated files must defend.
• Match the adverse-action language to the facts in credit-card limit assignment disparity table.
• Check HMDA coding and underwriting policy against HMDA data can be relied on.
• For this Fair Lending CRA and Special-Purpose Programs file, read credit-card limit assignment disparity table against a notice that cites 'other' as the principal reason 40% of the time and write the one fact that would move HMDA data can be relied on for exam-response coordinator.

Recommendation