I had the pleasure of speaking to the CMLA Executive Forum and the CMLA Operations Forum in Salt Lake City yesterday. We sure don’t see mountains like that here in Chicago. Gorgeous!
I could have not have been more impressed with the talented people I met!
One of the questions I was asked in the Operations Forum is a question that I believe many can benefit from. The question was “if the examiners are using regression analysis and after closing technologies, don’t we have to do the same thing?”
The answer to that is “no”. You certainly can do that but my question is why aren’t you doing this analysis at the time of lock, if you have the technology to prevent a problem? Why wouldn’t you be demonstrating to the examiner that you have a real time compliance management system that prevents fair lending issues, versus a fair lending analysis that looks at what has already been done? You’re logical people and that outdated technique does not make sense.
The examiners do not have the cool technology that you have access to, and trust me when I say they would love to have it. Your job as a Fair Lending Analyst is to continually self evaluate the individual consumer experience and justify or explain the aggregated loan trends for fair lending issues.
Also, remember that an examiner does not have to exam you if they believe you have things under control. Their initial inquiry to you regarding anomalies is sent, in part, to investigate your controls. If the answers they receive are sufficient, the processes that you use are sound, and the data that you gather is more substantial than what they have, they can decide that you are under control and leave. Isn’t that what you want? Or would you prefer they stick around for a couple of months pouring over your files?
Just because you have been using the same techniques for years folks, doesn’t mean you have to fall into that rythmn. After all, that method hasn’t served any of you well and simply causes chaos, misinformation and heavy duty fines.
So maybe it’s time to consider why our largest lenders have moved away from traditional fair lending analysis to real time analysis. Just a thought.
In the meantime, I am attaching a great guide to do a self assessment of your program. If you are unable to answer the questions in this attachment, you might want to start filling those holes to be fully prepared.
Thank you Salt Lake City. You were incredibly gracious and I loved your style!
Fair Lending Self Assessment Tool