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#1359397 - 03/17/10 08:35 PM Fair Lending - Steering & Secondary Mkt loans
Vander Offline
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Vander
Joined: Jul 2003
Posts: 216
Texas
We offer several loan products, including the option to sell to the secondary market at a fixed rate. I've heard some buzz about examiners targeting this area during fair lending exams and citing steering, if you cannot demonstrate you offered this type of product to all applicants.

Are any other banks seeing this during exams, and if so, what are you doing? I've heard some banks are impementing forms to document the applicant was told about the secondary market options.

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Lending Compliance
#1359565 - 03/18/10 12:11 AM Re: Fair Lending - Steering & Secondary Mkt loans Vander
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,164
Galveston, TX
Nothing new - it has always been a risk factor in a fair lending exam:

Indicators of potential disparate treatment by Steering such as:

S1. Lack of clear, objective and consistently implemented standards for (i) referring applicants to subsidiaries, affiliates, or lending channels within the institution (ii) classifying applicants as “prime” or “sub-prime” borrowers, or (iii) deciding what kinds of alternative loan products should be offered or recommended to applicants (product placement).
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