Fair Lending Magi
™
P o i n t & C l i c k F a i r L e n d i n g A n a ly s i s
www.fairlendingmagic.com
Fair Lending Magi
™
3.0!
We are continuously improving Fair Lending Magic™ to create the best online fair lending tool. Significant feedback has been gathered from our users when developing this version. We listened and responded with new features to make Fair Lending Magic™ easier and more enjoyable to use.
Graphical User Interface Easier navigation Fair Lending Magic™ 3.0 introduces an easier way to view fair lending. The design enhancements were done to provide a graphical overview of the entire fair lending compliance management process; from data import and data preparation to statistical, matched pair and redlining analysis.
G R A Pinterface HICA L Uyou S EtoReasily I Nmove T E Rfrom FAC E The new graphical allows one analytical process to another, providing expert guidance along the way.
Extensive On-line Help Help all in one place
Watch short “how-to” videos that explain many tasks.
Need to import some data, not sure where to begin an underwriting analysis, or how to create a map? The new extensive on-line help assists with step-by-step instructions.
3.0
Fair Lending Magi
™
3.0!
Data Quality Assessment Tool Smart & Simple With the introduction of the Data Quality Assessment Tool, your analysis is easier than ever. Quickly determine the quantity and quality of your data and identify the possible types of fair lending analyses that can and cannot be performed based upon your data’s integrity. Review data field population and check for invalid and missing variable values.
G R A P H I C A L U S E R I N T E R FAC E
View and export applications with missing or invalid data, giving you the ability to verify and fix data issues before proceeding with a more robust fair lending analysis.
Enhanced Reporting Document your findings with custom notes With respect to reporting, the new custom notes feature makes it easy for the review team to document and share insights on individual reports. It gives users the ability to enter file review notes in matched pairs explaining apparent business justifications, if any.
Analyze QM loans and disparate impact. Use Fair Lending Magic™ to evaluate whether a lending practice has a discriminatory effect that actually or predictably results in a disparate impact on a group by race/ethnicity, age or gender. Enhanced regression analysis to identify outlier cases in pricing and underwriting decisioning.
www.fairlendingmagic.com
Fair Lending Magi
™
O r g a n i z e a n d I m p l e m e n t Fa i r L e n d i n g M o n i to r i n g To day
Key Features and Benefits A complete online
H Fast sophisticated reports in minutes
fa i r l e n d i n g s o l u t i o n
H Simple and easy web-based interface with point & click filtering
H Elegant: Can create beautiful maps and charts Loan Types Analyzed by FLM
that document and tell your story
™
u Mortgage
H Cost effective: The best value of any fair lending
u Non-mortgage
u
Auto
u
Consumer
u
Small Business
analysis tool on the market
H Intuitive: Easy to learn and master without the expense of time consuming training courses
H extensive on-line help Primary Purposes of Fair Lending Magic™: • Provide a low cost and easy to use fair lending solution for institutions/ organizations of all sizes • Institutions can self-monitor for lending practices that bank examiners and enforcement agencies consider discriminatory • Allows lenders and enforcement agencies to identify potential lending violations of ECOA and FHAct • Guides institutions to appropriate corrective action • Conducts powerful descriptive analyses using matched pairs, statistics, and mapping • Perform CRA Reporting
Advantages of Web-based Software: Easy maintenance - You’re always using the latest and greatest version Easy installation - Why? Because there’s nothing to install, ever Fully compatible with other systems because it is web-based Secure - Everyone you trust has access to the data via username and password • Mobility - You can work from home, work, or on the road; anywhere you have an internet connection
• • • •
Fair Lending Magi Organize/Automate File Review Process
CRA
• • •
• • • •
• •
Assemble with one click multiple sets of fair lending workpapers Preserve accountability from a quality control perspective Organize data by time period, loan type, channel, company or user defined Use loan underwriting guidelines to flag underwriting exceptions Calculate pricing metrics
Build the Fair Lending Data Set for Analysis • • • • • • • • • •
Allows for the import of HMDA submission ready data Append additional data to create a rich dataset for fair lending studies Import existing electronic system data in a variety of formats (HMDA Plus, origination or servicing system, etc.) Ability to quickly import electronic data to begin analysis Update, edit or correct existing loan data from LOS Combine and export fair lending dataset to spreadsheets Automatically derive loan products from HMDA data Import custom geography areas Create stratified random samples Geocoding add-in
Monitor for Potential Disparate Treatment • •
•
•
Race Estimation Add-in Available • •
Create prohibited basis estimates for consumer, auto and business loans Estimate racial, ethnic and gender surrogates based on surnames and block group demographics using the Racestimator™
Determine the Scope of a Fair Lending Review •
Identify the loan products, markets, and prohibited basis groups to be analyzed based on: • Underwriting disparities • Pricing disparities • Market penetration disparities • Retail and wholesale monitoring • High-Side and Low-Side Overrides
Import assessment areas Build and export assessment areas Map assessment areas Report on assessment area demographics by • Number/percent Low/Mod tracts • Analyze loans inside vs. outside assessment areas • Number/percent owner-occupancy
• • • •
Determine why applicants with equal to better criteria were treated differently Conduct Underwriting and PricingSide by Side matched pair analysis Analyze loan officer and broker compensation Perform Benchmark/Overlap analysis Compare Approval/Denial rates in minority and non-minority areas Identify disparities inside and outside of CRA assessment areas Drill down by numerous fields Analyze market penetration and avoid redlining
Easily Run Statistics to Make More Informed Decisions • • • •
Perform logistic regression for underwriting Perform OLS regression for pricing Conduct T-Test, Chi Square to test for statistical significance Create Scatter Plots to visualize relations between variables of interest
Control for Relevant Factors • • • •
Limit analyses to specific loan products Conduct an analysis based upon a specific time period Evaluate the performance of a specific loan officer or broker Analyze focal points by geographic areas: • Metro Areas (MSA/MD) • State, county, city, towns and places • Tract Demographics (Minority, High Minority, Non-Minority, etc.)
ABC Bank T-Test Criteria: None Min Count 1:
0
Min Count 2:
0 Data Field
Cases
Mean
Standard Deviation
White, Exclude Hispanics
APRATE
479
8.2782
.5725
Black, Any ethnicity
APRATE
221
8.4542
.5777
700
8.3337
.5795
Total
F Test
Levene's Test
f-Statistic
.9821
p-value for F-Test
.4321
Not Significant, refer to Pooled Variance T-Test
f-Statistic
.0991
p-value for F-Test
.7530
Not Significant, refer to Pooled Variance T-Test
Pooled Variance T-Test t-Statistic
-3.7705
Degrees of Freedom
698.0000
p-Value for T-Test
.0002
Difference Between Means
-.1760
Significant
Separate Variance T-Test t-Statistic
-3.7579
Degrees of Freedom
424.0000
p-Value for T-Test
.0002
Difference Between Means
-.1760
Fair Lending Magic, a product of ComplianceTech Copyright 2013
Significant
™
Fair Lending Magi
™
Powerful Visual Reporting with Charts and Maps • • • • •
Visually depict lending patterns in charts and maps Plot applications and loans on fair lending thematic map layers Export charts as xls, html, rtf, pdf and bmp Save, copy and paste map images for use in reports Compare your company’s profile to its regulatory peers
Extensive Security and Compliance Features • Hosted on a SAS 70 Secured Site approved by a bank regulator • Does not store personal identifiers • Access controlled through customer ID, user name and password authentication • Loan identifiers are encrypted • Meets government mandated privacy standards •
Section 508 compliant for persons with disabilities
Ask about the discount for the Fair Lending Patterns™ bundle of LendingPatterns™ and Fair Lending Magic™
Fair Lending Magi
™
Contact us today to schedule an Online Demonstration: 202-842-3800 | www.fairlendingmagic.com ComplianceTech 2120 Washington Blvd. Suite 400 Arlington,VA 22204