Assess whether dealer overlays introduce prohibited steering (3137cb)

Situation

After a notice that cites 'other' as the principal reason 40% of the time, SPCP written plan versus actual originations 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 SPCP written plan versus actual originations after a notice that cites 'other' as the principal reason 40% of the time.

Hypotheses to test

• The population in SPCP written plan versus actual originations is the one a notice that cites 'other' as the principal reason 40% of the time named, so Remove access or reverse the item follows for this CRA and Special-Purpose Programs file.
• The population in SPCP written plan versus actual originations is adjacent only to a notice that cites 'other' as the principal reason 40% of the time; Temporary compensating control is the honest Fair Lending call.
• A credit union rolling out a special-purpose credit program already contained a notice that cites 'other' as the principal reason 40% of the time before SPCP written plan versus actual originations arrived; no new CRA and Special-Purpose Programs path.
• Provenance on SPCP written plan versus actual originations after a notice that cites 'other' as the principal reason 40% of the time is broken; do not pick Remove access or reverse the item or Temporary compensating control yet.

Analysis required

• Check HMDA coding and underwriting policy against dealer overlays introduce prohibited.
• Compare SPCP written plan versus actual originations 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 HMDA data-quality manager cannot explain from SPCP written plan versus actual originations.
• For this Fair Lending CRA and Special-Purpose Programs file, read SPCP written plan versus actual originations against a notice that cites 'other' as the principal reason 40% of the time and write the one fact that would move dealer overlays introduce prohibited for HMDA data-quality manager.