Fair Lending
 

COMPLY FAIR LENDING

Overview

RATA Associates, the leading provider of HMDA/CRA products and services to the lending compliance arena expanded into the Fair Lending market with the release of Comply Fair Lending in 2004. Comply Fair Lending is a robust software solution based on the FFIEC Fair Lending Examination Procedures and is the simplest and most cost effective way to monitor potential risk associated with lending performance.

Comply Fair Lending is designed to create a “snapshot” of your HMDA and/or CRA data either by importing the data or copying a filtered subset of the data from a Reporting Entity within the system. Once you have data in the Fair Lending component, the next step is to analyze the data against the government risk factors. Comply Fair Lending does this by running a series of Scorecards that are designed to easily identify Statistically Significant Disparities in your data.

To run the disparity “scorecards”, you only need the LAR data and a few other fields, but running the scorecards and identifying the potential risk is only half of the battle. Once the risk areas have been identified, Comparative File Reviews or CFR’s must be done to examine the disparities and explain the differences in outcomes between prohibited basis and non-prohibited basis applicants. To maximize the capabilities of Comply Fair Lending’s CFR functionality, you will want to have as much supplemental application data in the system as possible in the system to assist with this process.

Comply Fair Lending will help with all of this and more.

In summary, Comply Fair Lending will:

  • Import all LAR and Fair Lending related data
  • Allow you to run edits to make sure the data is complete and accurate
  • Allow you to run scorecards on all government Risk Factors (Pricing, Underwriting, Redlining, Steering, etc…)
  • The scorecards will show any statistically significant disparities between Prohibited and Non-Prohibited basis applicants
  • Drill down within the data to find similarly situated applications. (i.e. By Product, Geography, Time Period, Channel, etc…)
  • Perform a Comparative File Reviews on a high risk categories
  • Using a Wizard you will be able to find the most similar applications based on your underwriting criteria with different outcomes and pair them up for review in decreasing similarity order
  • Allow you to document the key factors for the different outcomes and categories
  • Allow you to prepare an Executive Summary of your research and findings

Comply Fair Lending Regression
The Regression module (optional) for the Fair Lending component is now available! It has been designed for use by a highly technical person, but will expand the capabilities of Comply Fair Lending a great deal. Although you can get to the same point with or without the regression module, for a trained person, Regression is much more efficient. Conversely, for a non-statistical and less technical person the non-regression method is the best solution.