Assess whether line assignments have a disparate impact the bank will defend

SITUATION After a HMDA resubmission that still fails quality edits, appraisal-gap outcomes in majority-minority tracts is what second-review underwriter can touch in a lender expanding into majority-minority census tracts. Fair Lending will live with Remove access or reverse the item versus Temporary compensating control on this CRA and Special-Purpose Programs file.

DECISION Second-review underwriter in a lender expanding into majority-minority census tracts must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using appraisal-gap outcomes in majority-minority tracts after a HMDA resubmission that still fails quality edits.

HYPOTHESES TO TEST 1. Second-review underwriter can defend Remove access or reverse the item from appraisal-gap outcomes in majority-minority tracts after a HMDA resubmission that still fails quality edits in a Fair Lending challenge. 2. Second-review underwriter cannot defend Remove access or reverse the item from appraisal-gap outcomes in majority-minority tracts; Temporary compensating control is what the extract actually supports after a HMDA resubmission that still fails quality edits. 3. A HMDA resubmission that still fails quality edits never reached the population in appraisal-gap outcomes in majority-minority tracts — reopen intake, do not close line assignments have a. 4. Two facts in appraisal-gap outcomes in majority-minority tracts after a HMDA resubmission that still fails quality edits conflict for second-review underwriter; hold this CRA and Special-Purpose Programs file.

ANALYSIS REQUIRED 1. Check HMDA coding and underwriting policy against line assignments have a. 2. Compare appraisal-gap outcomes in majority-minority tracts to similarly situated files, second-review notes, and reason codes after a HMDA resubmission that still fails quality edits. 3. Flag any disparate-impact table second-review underwriter cannot explain from appraisal-gap outcomes in majority-minority tracts. 4. For this Fair Lending CRA and Special-Purpose Programs file, read appraisal-gap outcomes in majority-minority tracts against a HMDA resubmission that still fails quality edits and write the one fact that would move line assignments have a for second-review underwriter.

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 (appraisal-gap outcomes in majority-minority tracts after a HMDA resubmission that still fails quality edits). The follow-on CRA and Special-Purpose Programs action is what second-review underwriter does next: implement the option, assign an owner, and log the missing fact.