Assess whether comparative files show second-review bias (e92656)

Situation

Geographic application and origination heat map arrived with a SPCP that originated almost no loans to the intended class for community-development lender. That is a Fair Lending Redlining and HMDA Data decision on comparative files show second-review in a mortgage company after a pricing-regression spike.

Decision

Community-development lender in a mortgage company after a pricing-regression spike 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

• A SPCP that originated almost no loans to the intended class is noise around an already-controlled Redlining and HMDA Data process in a mortgage company after a pricing-regression spike, given geographic application and origination heat map.
• A SPCP that originated almost no loans to the intended class is the event in geographic application and origination heat map that forces Remove access or reverse the item for community-development lender under Fair Lending.
• Geographic application and origination heat map shows a one-file miss after a SPCP that originated almost no loans to the intended class, not a Redlining and HMDA Data program failure.
• Geographic application and origination heat map cannot decide comparative files show second-review yet after a SPCP that originated almost no loans to the intended class; hold is the only Fair Lending close a mortgage company after a pricing-regression spike can defend.

Analysis required

• 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 community-development lender cannot explain from geographic application and origination heat map.
• Test a documented exception versus a pattern a mortgage company after a pricing-regression spike must defend.
• For this Fair Lending Redlining and HMDA Data 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 comparative files show second-review for community-development lender.