Assess whether HMDA data can be relied on for the exam (fd7364)

Situation

After a SPCP that originated almost no loans to the intended class, geographic application and origination heat map is what HMDA data-quality manager can touch in a credit union rolling out a special-purpose credit program. Fair Lending will live with Remove access or reverse the item versus Temporary compensating control on this CRA and Special-Purpose Programs file.

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 geographic application and origination heat map after a SPCP that originated almost no loans to the intended class.

Hypotheses to test

• Authorize Remove access or reverse the item now; geographic application and origination heat map already has the discriminator after a SPCP that originated almost no loans to the intended class.
• Keep Temporary compensating control in force until geographic application and origination heat map is completed after a SPCP that originated almost no loans to the intended class for HMDA data-quality manager.
• Treat geographic application and origination heat map as Approve a documented exception because both readings appear after a SPCP that originated almost no loans to the intended class.
• Refuse a Fair Lending close: HMDA data-quality manager does not have the page HMDA data can be relied on turns on in geographic application and origination heat map.

Analysis required

• Check HMDA coding and underwriting policy against HMDA data can be relied on.
• Compare geographic application and origination heat map to similarly situated files, second-review notes, and reason codes after a SPCP that originated almost no loans to the intended class.
• Flag any disparate-impact table HMDA data-quality manager cannot explain from geographic application and origination heat map.
• For this Fair Lending CRA and Special-Purpose Programs file, read geographic application and origination heat map against a SPCP that originated almost no loans to the intended class and write the one fact that would move HMDA data can be relied on for HMDA data-quality manager.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / CRA and Special-Purpose Programs packet (geographic application and origination heat map after a SPCP that originated almost no loans to the intended class). Lead with the Fair Lending option geographic application and origination heat map can support after a SPCP that originated almost no loans to the intended class, then the two facts that force it, then the Monday action for HMDA data-quality manager in a credit union rolling out a special-purpose credit program.