Welcome to BOL Kristin.
A lot of what the bank does is dependant on their appetite risk, which would be dictated by ALCO, Risk Management, or Audit Committees. A bank that went from LO underwriting to automated underwriting had a 6 month trial, where they allowed 15% low side overrides and 10% high side overrides. At the end of the period, they analyzed the results and compared the portfolio to expectations and dropped to 10% and 5% respectively. That also gave the loan officers time to adjust. Your model should give you some guidance.
For any exception or override, remember to record, analyze, track and report. Based on results, you can adjust your tolerances.
From a Fair Lending side, be very careful about any exceptions to policy or pricing. An exception given to one applicant can be discriminating to the other applicant that it was not given (or offered) to.
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Integrity. With it, nothing else matters. Without it, nothing else matters.