Assess whether the exam response should concede a finding (018a2a)

SITUATION An exception rate twice as high for one group after credit controls put mortgage pricing residual by prohibited-basis group in front of fair-lending officer in an institution preparing for a redlining exam. This Fair Lending / Examination and Notices decision is the exam response should from mortgage pricing residual by prohibited-basis group, and the live options are Remove access or reverse the item, Temporary compensating control, Approve a documented exception.

DECISION Fair-lending officer in an institution preparing for a redlining exam must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using mortgage pricing residual by prohibited-basis group after an exception rate twice as high for one group after credit controls.

HYPOTHESES TO TEST 1. An exception rate twice as high for one group after credit controls is noise around an already-controlled Examination and Notices process in an institution preparing for a redlining exam, given mortgage pricing residual by prohibited-basis group. 2. An exception rate twice as high for one group after credit controls is the event in mortgage pricing residual by prohibited-basis group that forces Remove access or reverse the item for fair-lending officer under Fair Lending. 3. Mortgage pricing residual by prohibited-basis group shows a one-file miss after an exception rate twice as high for one group after credit controls, not a Examination and Notices program failure. 4. Mortgage pricing residual by prohibited-basis group cannot decide the exam response should yet after an exception rate twice as high for one group after credit controls; hold is the only Fair Lending close an institution preparing for a redlining exam can defend.

ANALYSIS REQUIRED 1. Test a documented exception versus a pattern an institution preparing for a redlining exam must defend. 2. Match the adverse-action language to the facts in mortgage pricing residual by prohibited-basis group. 3. Check HMDA coding and underwriting policy against the exam response should. 4. For this Fair Lending Examination and Notices file, read mortgage pricing residual by prohibited-basis group against an exception rate twice as high for one group after credit controls and write the one fact that would move the exam response should for fair-lending officer.

RECOMMENDATION Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Examination and Notices packet (mortgage pricing residual by prohibited-basis group after an exception rate twice as high for one group after credit controls). The follow-on Examination and Notices action is what fair-lending officer does next: implement the option, assign an owner, and log the missing fact.