You know the importance of ensuring compliance with fair lending regulations. But have you considered the dangers of redlining specifically and completely? Redlining Defined Redlining is the practice of denying or limiting financial services to certain neighborhoods or areas, often based on factors such as race, ethnicity, or income level. While it is illegal, redlining […]
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Overview Earlier this month, there was a major development that could prove to be very significant in regard to fair lending. On September 1st, the CFPB released its proposed rule regarding small business lending data collection. The rule, mandated under the Dodd-Frank Act, and, if finalized and implemented, will require lenders to collect and report […]
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With respect to potential fair lending issues, redlining has remained a significant focus during regulatory examinations for a number of years. There are a number of critical pressure points that should accompany an institution’s self-evaluation of redlining risk. These points are broad and range from marketing efforts, products, branch locations, delineation of assessment and market […]
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In previous posts (see The Fair Lending Risk of Good Intentions) we have discussed fair lending risks associated with certain well-intended practices. In an effort to avoid fair lending risks, institutions may find it tempting to have practices that either favor protected classes or policies that eliminate any variation in pricing or decisioning in an […]
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2020? Yes, 2020. With the bizarre nature of last year, it is easy to overlook some of the year’s significance. One is that 2020 was a Decennial Census year, with the population of the U.S. recounted. It is never too early to think about this as there will likely be changes that will affect those […]
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Fair lending concerns are one of the dominant risks lenders face in regard to their business operations. Although larger lenders typically have significant resources in place to mitigate these risks, and there has been an emphasis in the last decade on quantitative methods for fair lending evaluation, there remains a great deal of subjectivity in […]
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Below, we provide a summary of the recently released 2019 HMDA data, and keys for understanding the importance of these data. The Basics Enacted by Congress in 1975, and implemented by Regulation C, the Home Mortgage Disclosure Act (HMDA) is considered “the most comprehensive, publicly available information on mortgage market activity.” Its purpose is to […]
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The term “Information Age” probably pre-dates many who are reading this post, possibly originating as early as the 1970’s with the proliferation of computer technology. From the mainframe era, to PC’s, laptops, personal devices and smart phones, technology continues to shape our world at a seemingly ever increasing rate. This is all augmented by the […]
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The Bureau of Consumer Financial Protection issued its seventh Fair Lending Report to Congress. The report, released June 28, 2019, describes the Bureau’s fair lending activities in prioritization, supervision, enforcement, rulemaking, interagency coordination, and outreach for calendar year 2018.
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We have discussed previously in various posts some of the challenges of using regression and other statistical methods for fair lending reviews as well as the current emphasis on quantitative methods. Over the last 10 years, the regulatory and enforcement agencies as well as institutions have been gravitating more and more towards statistical methods when […]
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