Assess whether a redlining pattern exists after controls after a notice that

Situation

A redlining pattern exists sits with second-review underwriter because a notice that cites 'other' as the principal reason 40% of the time hit a small-business desk using a new vendor score. Evidence is adverse-action notice principal-reason sample; write the Fair Lending Redlining and HMDA Data option that extract can carry.

Decision

Second-review underwriter 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 adverse-action notice principal-reason sample after a notice that cites 'other' as the principal reason 40% of the time.

Hypotheses to test

• Second-review underwriter can defend Remove access or reverse the item from adverse-action notice principal-reason sample after a notice that cites 'other' as the principal reason 40% of the time in a Fair Lending challenge.
• Second-review underwriter 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 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 adverse-action notice principal-reason sample — reopen intake, do not close a redlining pattern exists.
• Two facts in adverse-action notice principal-reason sample after a notice that cites 'other' as the principal reason 40% of the time conflict for second-review underwriter; hold this Redlining and HMDA Data file.

Analysis required

• Check HMDA coding and underwriting policy against a redlining pattern exists.
• Compare adverse-action notice principal-reason sample to similarly situated files, second-review notes, and reason codes after a notice that cites 'other' as the principal reason 40% of the time.
• Flag any disparate-impact table second-review underwriter cannot explain from adverse-action notice principal-reason sample.
• For this Fair Lending Redlining and HMDA Data file, read adverse-action notice principal-reason sample against a notice that cites 'other' as the principal reason 40% of the time and write the one fact that would move a redlining pattern exists for second-review underwriter.

Recommendation