Assess whether a special-purpose program is well designed or a pretext

Situation

A special-purpose program is sits with second-review underwriter because a DOJ or CFPB monitor request for pricing files hit a lender expanding into majority-minority census tracts. Evidence is small-business decline comparative file set; write the Fair Lending CRA and Special-Purpose Programs option that extract can carry.

Decision

Second-review underwriter in a lender expanding into majority-minority census tracts must choose A special-purpose program is well designed / A pretext using small-business decline comparative file set after a DOJ or CFPB monitor request for pricing files.

Hypotheses to test

• Small-business decline comparative file set reads as A special-purpose program is well designed once a DOJ or CFPB monitor request for pricing files is lined up to the same Fair Lending population.
• Small-business decline comparative file set is closer to A pretext after a DOJ or CFPB monitor request for pricing files; A special-purpose program is well designed would over-claim this CRA and Special-Purpose Programs extract.
• A dual reading is still live in small-business decline comparative file set for second-review underwriter in a lender expanding into majority-minority census tracts.
• Small-business decline comparative file set is missing the fact second-review underwriter needs after a DOJ or CFPB monitor request for pricing files; stop this Fair Lending close.

Analysis required

• Compare small-business decline comparative file set to similarly situated files, second-review notes, and reason codes after a DOJ or CFPB monitor request for pricing files.
• Flag any disparate-impact table second-review underwriter cannot explain from small-business decline comparative file set.
• Test a documented exception versus a pattern a lender expanding into majority-minority census tracts must defend.
• For this Fair Lending CRA and Special-Purpose Programs file, read small-business decline comparative file set against a DOJ or CFPB monitor request for pricing files and write the one fact that would move a special-purpose program is for second-review underwriter.

Recommendation

Choose A special-purpose program is well designed / A pretext on this Fair Lending / CRA and Special-Purpose Programs packet (small-business decline comparative file set after a DOJ or CFPB monitor request for pricing files). Lead with the Fair Lending option small-business decline comparative file set can support after a DOJ or CFPB monitor request for pricing files, then the two facts that force it, then the Monday action for second-review underwriter in a lender expanding into majority-minority census tracts.