Assess whether HMDA data can be relied on for the exam (d787fa)

Situation

Manufactured-housing dealer overlay notes arrived with a HMDA resubmission that still fails quality edits for second-review underwriter. That is a Fair Lending Examination and Notices decision on HMDA data can be relied on in a credit union rolling out a special-purpose credit program.

Decision

Second-review underwriter 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 manufactured-housing dealer overlay notes after a HMDA resubmission that still fails quality edits.

Hypotheses to test

• Second-review underwriter can defend Remove access or reverse the item from manufactured-housing dealer overlay notes after a HMDA resubmission that still fails quality edits in a Fair Lending challenge.
• Second-review underwriter cannot defend Remove access or reverse the item from manufactured-housing dealer overlay notes; Temporary compensating control is what the extract actually supports after a HMDA resubmission that still fails quality edits.
• A HMDA resubmission that still fails quality edits never reached the population in manufactured-housing dealer overlay notes — reopen intake, do not close HMDA data can be relied on.
• Two facts in manufactured-housing dealer overlay notes after a HMDA resubmission that still fails quality edits conflict for second-review underwriter; hold this Examination and Notices file.

Analysis required

• Flag any disparate-impact table second-review underwriter cannot explain from manufactured-housing dealer overlay notes.
• Test a documented exception versus a pattern a credit union rolling out a special-purpose credit program must defend.
• Match the adverse-action language to the facts in manufactured-housing dealer overlay notes.
• For this Fair Lending Examination and Notices file, read manufactured-housing dealer overlay notes against a HMDA resubmission that still fails quality edits and write the one fact that would move HMDA data can be relied on for second-review underwriter.

Recommendation

Choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold on this Fair Lending / Examination and Notices packet (manufactured-housing dealer overlay notes after a HMDA resubmission that still fails quality edits). If manufactured-housing dealer overlay notes cannot force a Fair Lending label under Examination and Notices, stop. Do not invent pages a credit union rolling out a special-purpose credit program does not have.