Hi! It’s Tory Haggerty from Tuscan Club University’s Fair Lending School
In this fair lending short, we are going to talk about the importance of knowing your data.
There is a myth that many people believe – that is if there is data available, someone is looking at it.
That’s partially true – the regulators are. But is someone in your organization also reviewing it? Too often, institutions have no idea what their data says.
If you are a HMDA reporter, or a large bank under CRA, you already have a ton of useful data to find out your fair lending performance.
Even if you don’t have that information, you can still get great data and form conclusions from your loan download. This is a one-year history of all loans originated in an Excel spreadsheet.
Think of this as an open book test, but, you get to look up the answers.
Our fair lending school teaches you how to cut up your loan download to do pricing and redlining reviews.
Everyone should be tracking loan exceptions, and you can then compare your exceptions data with your loan download to see if you are granting exceptions fairly and equitably. This can be done for free with the right knowledge and Microsoft Excel.
Maybe you do a redlining review by geocoding loans and comparing your performance with demographic data.
Those with HMDA data should be also comparing your performance to your peers. If peers are lending to minority borrowers and high minority areas 2, 3, and 4 times more often than your organization, you need to know this and put a corrective action plan in place right away.
The only thing worse than not knowing your data is knowing you have poor performance and doing nothing.
Click here to learn more about Fair Lending Compliance & Audit Training.
