Assess whether a redlining pattern exists after controls from underwriting

Situation

After a SPCP that originated almost no loans to the intended class, underwriting exception log by branch is what adverse-action notice operations lead can touch in a credit union rolling out a special-purpose credit program. Fair Lending will live with Remove access or reverse the item versus Temporary compensating control on this Pricing and Credit Limits file.

Decision

Adverse-action notice operations lead 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 underwriting exception log by branch after a SPCP that originated almost no loans to the intended class.

Hypotheses to test

• Underwriting exception log by branch reads as Remove access or reverse the item once a SPCP that originated almost no loans to the intended class is lined up to the same Fair Lending population.
• Underwriting exception log by branch is closer to Temporary compensating control after a SPCP that originated almost no loans to the intended class; Remove access or reverse the item would over-claim this Pricing and Credit Limits extract.
• Approve a documented exception is still live in underwriting exception log by branch for adverse-action notice operations lead in a credit union rolling out a special-purpose credit program.
• Underwriting exception log by branch is missing the fact adverse-action notice operations lead needs after a SPCP that originated almost no loans to the intended class; stop this Fair Lending close.

Analysis required

• Match the adverse-action language to the facts in underwriting exception log by branch.
• Check HMDA coding and underwriting policy against a redlining pattern exists.
• Compare underwriting exception log by branch 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 Pricing and Credit Limits file, read underwriting exception log by branch 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 / Pricing and Credit Limits packet (underwriting exception log by branch after a SPCP that originated almost no loans to the intended class). If underwriting exception log by branch cannot force a Fair Lending label under Pricing and Credit Limits, stop. If underwriting exception log by branch 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 Pricing and Credit Limits close, adverse-action notice operations lead must do not infer a control or scheme beyond the transaction and entitlement evidence.