Assess whether HMDA data can be relied on for the exam (6969da)

Situation

HMDA data can be relied on sits with CRA strategist because a SPCP that originated almost no loans to the intended class hit a bank with thin HMDA LAR quality. Evidence is manufactured-housing dealer overlay notes; write the Fair Lending Examination and Notices option that extract can carry.

Decision

CRA strategist in a bank with thin HMDA LAR quality must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using manufactured-housing dealer overlay notes after a SPCP that originated almost no loans to the intended class.

Hypotheses to test

• The population in manufactured-housing dealer overlay notes is the one a SPCP that originated almost no loans to the intended class named, so Remove access or reverse the item follows for this Examination and Notices file.
• The population in manufactured-housing dealer overlay notes is adjacent only to a SPCP that originated almost no loans to the intended class; Temporary compensating control is the honest Fair Lending call.
• A bank with thin HMDA LAR quality already contained a SPCP that originated almost no loans to the intended class before manufactured-housing dealer overlay notes arrived; no new Examination and Notices path.
• Provenance on manufactured-housing dealer overlay notes after a SPCP that originated almost no loans to the intended class is broken; do not pick Remove access or reverse the item or Temporary compensating control yet.

Analysis required

• Match the adverse-action language to the facts in manufactured-housing dealer overlay notes.
• Check HMDA coding and underwriting policy against HMDA data can be relied on.
• Compare manufactured-housing dealer overlay notes to similarly situated files, second-review notes, and reason codes after a SPCP that originated almost no loans to the intended class.
• For this Fair Lending Examination and Notices file, read manufactured-housing dealer overlay notes against a SPCP that originated almost no loans to the intended class and write the one fact that would move HMDA data can be relied on for CRA strategist.

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 SPCP that originated almost no loans to the intended class). If manufactured-housing dealer overlay notes cannot force a Fair Lending label under Examination and Notices, stop. If manufactured-housing dealer overlay notes after a SPCP that originated almost no loans to the intended class cannot support Remove access or reverse the item versus Temporary compensating control on this Fair Lending Examination and Notices close, CRA strategist must do not infer a control or scheme beyond the transaction and entitlement evidence.