Assess whether HMDA data can be relied on for the exam (854224)

Situation

A small-business desk using a new vendor score cannot treat a branch that stopped taking applications in one ZIP as color commentary on model-reason-code mapping that does not match notices. HMDA data-quality manager must close HMDA data can be relied on from that extract under Fair Lending / Examination and Notices.

Decision

HMDA data-quality manager in a small-business desk using a new vendor score must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using model-reason-code mapping that does not match notices after a branch that stopped taking applications in one ZIP.

Hypotheses to test

• Model-reason-code mapping that does not match notices reads as Remove access or reverse the item once a branch that stopped taking applications in one ZIP is lined up to the same Fair Lending population.
• Model-reason-code mapping that does not match notices is closer to Temporary compensating control after a branch that stopped taking applications in one ZIP; Remove access or reverse the item would over-claim this Examination and Notices extract.
• Approve a documented exception is still live in model-reason-code mapping that does not match notices for HMDA data-quality manager in a small-business desk using a new vendor score.
• Model-reason-code mapping that does not match notices is missing the fact HMDA data-quality manager needs after a branch that stopped taking applications in one ZIP; stop this Fair Lending close.

Analysis required

• Compare model-reason-code mapping that does not match notices to similarly situated files, second-review notes, and reason codes after a branch that stopped taking applications in one ZIP.
• Flag any disparate-impact table HMDA data-quality manager cannot explain from model-reason-code mapping that does not match notices.
• Test a documented exception versus a pattern a small-business desk using a new vendor score must defend.
• For this Fair Lending Examination and Notices file, read model-reason-code mapping that does not match notices against a branch that stopped taking applications in one ZIP and write the one fact that would move HMDA data can be relied on for HMDA data-quality manager.

Recommendation