Hi! It’s Tory Haggerty from Tuscan Club University’s Fair Lending School and welcome to another Fair Lending Short.
Today I want to talk about going the extra mile for an application. Now, whenever you train lenders try not to harp on them too much. Lenders are the reason you have a job if you’re in banking. They bring customers through the door, they lend money, and that is what allows people in banks, credit unions and mortgage companies to have jobs. It brings revenue.
The problem is when you go out of your way to go the extra mile for just one applicant. Someone comes into your organization and applies for a loan, and maybe they have a collection action or judgment, and you tell them, hey go pay this off and come back in a month and we’ll see if we can get you approved. That’s going the extra mile to get them approved and that’s usually a good thing.
But if you’re not willing to do that for everybody you run into some fair lending risks. If you do it for one customer but not another, then you’re not giving equal treatment. The fair lending laws and regulations say you need to give everybody the same opportunity to apply for credit and get a loan. And that’s what we’re trying to do, we’re trying to level the playing field. If you give someone additional opportunities, in order to correct credit issues, but then you deny another person in the same situation, then you’re not giving equal treatment to customers.
So, when you train your lenders, remind them that if they’re willing to go the extra mile for one application, they need to be willing to go the extra mile for everybody. And make sure to do it consistently.
Thanks for reading!