Assess whether HMDA data can be relied on for the exam (c50230)

Situation

In a manufactured-housing lender with dealer-originated files, adverse-action notice principal-reason sample is the evidence after a CRA PE that called the assessment area too narrow. Fair-lending officer has to pick Remove access or reverse the item or Temporary compensating control for this Fair Lending Redlining and HMDA Data close using adverse-action notice principal-reason sample.

Decision

Fair-lending officer in a manufactured-housing lender with dealer-originated files must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using adverse-action notice principal-reason sample after a CRA PE that called the assessment area too narrow.

Hypotheses to test

• A CRA PE that called the assessment area too narrow is noise around an already-controlled Redlining and HMDA Data process in a manufactured-housing lender with dealer-originated files, given adverse-action notice principal-reason sample.
• A CRA PE that called the assessment area too narrow is the event in adverse-action notice principal-reason sample that forces Remove access or reverse the item for fair-lending officer under Fair Lending.
• Adverse-action notice principal-reason sample shows a one-file miss after a CRA PE that called the assessment area too narrow, not a Redlining and HMDA Data program failure.
• Adverse-action notice principal-reason sample cannot decide HMDA data can be relied on yet after a CRA PE that called the assessment area too narrow; hold is the only Fair Lending close a manufactured-housing lender with dealer-originated files can defend.

Analysis required

• Test a documented exception versus a pattern a manufactured-housing lender with dealer-originated files must defend.
• Match the adverse-action language to the facts in adverse-action notice principal-reason sample.
• Check HMDA coding and underwriting policy against HMDA data can be relied on.
• For this Fair Lending Redlining and HMDA Data file, read adverse-action notice principal-reason sample against a CRA PE that called the assessment area too narrow and write the one fact that would move HMDA data can be relied on for fair-lending officer.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Redlining and HMDA Data packet (adverse-action notice principal-reason sample after a CRA PE that called the assessment area too narrow). Lead with the Fair Lending option adverse-action notice principal-reason sample can support after a CRA PE that called the assessment area too narrow, then the two facts that force it, then the Monday action for fair-lending officer in a manufactured-housing lender with dealer-originated files.