Assess whether a redlining pattern exists after controls after a SPCP that

Situation

Adverse-action notice operations lead in a lender expanding into majority-minority census tracts has one working extract — HMDA LAR validity and quality edits — after a SPCP that originated almost no loans to the intended class. If HMDA LAR validity and quality edits cannot support a redlining pattern exists, the honest Fair Lending output is hold.

Decision

Adverse-action notice operations lead in a lender expanding into majority-minority census tracts must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using HMDA LAR validity and quality edits after a SPCP that originated almost no loans to the intended class.

Hypotheses to test

• The population in HMDA LAR validity and quality edits 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 Redlining and HMDA Data file.
• The population in HMDA LAR validity and quality edits 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 lender expanding into majority-minority census tracts already contained a SPCP that originated almost no loans to the intended class before HMDA LAR validity and quality edits arrived; no new Redlining and HMDA Data path.
• Provenance on HMDA LAR validity and quality edits 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 HMDA LAR validity and quality edits.
• Check HMDA coding and underwriting policy against a redlining pattern exists.
• Compare HMDA LAR validity and quality edits 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 Redlining and HMDA Data file, read HMDA LAR validity and quality edits against a SPCP that originated almost no loans to the intended class and write the one fact that would move a redlining pattern exists for adverse-action notice operations lead.

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 (HMDA LAR validity and quality edits after a SPCP that originated almost no loans to the intended class). Lead with the Fair Lending option HMDA LAR validity and quality edits can support after a SPCP that originated almost no loans to the intended class, then the two facts that force it, then the Monday action for adverse-action notice operations lead in a lender expanding into majority-minority census tracts.