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MMC Equal Credit Opportunity Act Exam Procedures:
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Examination Procedures
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Yes
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No
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Examiner Notes [Document supporting evidence and note determinations and findings made.]
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1
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Coordinate compliance examination activities with other members of the examination team and the examiner-in-charge (EIC). Emphasis should be on identifying violations of law and regulation; integrating those findings with the examination; and concluding on management's compliance with laws and regulations.
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2
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Review and evaluate the adequacy of policies, procedures, and internal controls to ensure the identification of applicable applicants and compliance with the requirements of ECOA and FRB Regulation B.
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3
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Determine whether applications are accepted from all eligible persons without regard to race, color, religion, national origin, sex, marital status, age, receipt of public assistance income, or good faith exercise of credit rights.
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4
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Determine if the information requested on the loan application is in compliance with the provisions of ECOA that prohibit requesting certain information.
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5
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Determine if voluntary monitoring information is obtained only when required by ECOA and whether the applicant(s) was informed that if the applicant(s) chose not to provide the monitoring information, the creditor is required to note the race or national origin and sex on the basis of visual observation or surname. If the information was recorded based on visual observation or surname, determine whether this fact was also noted on the form.
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6
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Determine whether income and age were considered in accordance with ECOA.
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7
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Determine whether the loan files were free from information prohibited by ECOA.
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8
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Determine whether applicants were given timely notification of approval, rejection or counter offers in accordance with ECOA.
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9
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Determine whether applicants were provided or notified of the right to receive--a copy of appraisal reports on loans secured by a dwelling.
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10
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Determine whether ECOA record retention requirements were met.
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11
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Review rejected and withdrawn applications and determine whether the following provisions were observed:
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a. Was the notice timely?
b. Did the notice include: (1) the action taken, (2) the ECOA Notice, (3) the specific reason for the action taken, and (4) the names of all creditors involved?
c. Were the reasons for the action taken based solely on economic factors?
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12
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Determine whether any complaints were filed against the institution. If so, ascertain whether appropriate action was taken.
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13
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Conclude as if the institution is adequately complying with FRB Regulation B. If not, ascertain whether the conclusion of noncompliance is supported by adequate documentation of the specific noncompliance.
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14
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Utilize discussions with institution managers as needed to gather information and discuss whether procedures and practices followed by institution personnel ensure compliance with laws and regulations.
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15
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Discuss items of concern, scope of work performed, and conclusions with the EIC.
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16
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Organize and compile, if necessary, violations of law and regulation into Violation Summary Sheet.
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MMC Home Mortgage Disclosure Act Exam Procedures
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Examination Procedures
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Yes
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No
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Examiner Notes [Document supporting evidence and note determinations and findings made.]
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1
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Coordinate compliance examination activities with other members of the examination team and the examiner-in-charge (EIC). Emphasis should be on identifying violations of law and regulation; integrating those findings with the examination; and concluding on management's compliance with laws and regulations.
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2
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Review and evaluate the adequacy of policies, procedures, and internal controls to ensure the identification of applicable applicants and compliance with the requirements of HMDA and FRB Regulation C.
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3
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Determine if the institution is ensuring that home mortgage loan information and records are properly compiled, maintained, and accurately disclosed.
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4
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Ascertain whether management ensures that policies, procedures, and training, on an ongoing basis, are adequate and help facilitate awareness among responsible staff.
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5
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Determine whether the correct HMDA-LAR form or format being used. If so, determine if it is in machine-readable format.
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6
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Determine if the institution has posted notices in the lobbies of its home and branch offices that are located in MSAs on the availability of the HMDA disclosure statement and the modified HMDA-LAR. Find out if the disclosure statement and HMDA-LAR is actually available at the home office and at least one branch office, if any, in each MSA.
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7
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Determine whether HMDA disclosure statements are retained for 5 years, and if the HMDA-LARs are retained for 3 years.
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8
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Determine whether the necessary census tract information is available and if the census tracts and/or county designations are accurate on the HMDA-LAR.
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9
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Ascertain whether the latest disclosure statement was available to the public by March 31 following the calendar year for which the data were compiled.
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10
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Determine if the institution also reports data regarding the race or national origin, sex, and annual income of applicants for loans originated or applied for (does not include loans that are purchased). If the information is not provided, determine if the institution notes the data based on visual observation or surname.
NOTE: Alternatively, the form used to obtain monitoring information under Section 202.13 of FRB Regulation B (Equal Credit Opportunity Act) may be used.
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11
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Conclude whether the institution is adequately complying with FRB Regulation C. If not, ascertain whether the conclusion of noncompliance is supported by adequate documentation of the specific noncompliance.
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12
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Utilize discussions with institution managers as needed to gather information and discuss procedures and practices followed by institution personnel to ensure compliance with laws and regulations.
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13
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Discuss items of concern, scope of work performed, and conclusions with the EIC.
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14
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Utilize HMDA Analyzer as described in the Technology for Portfolio Review Section to check for violations.
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15
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Organize and compile, if necessary, violations of law and regulation into a Violation Summary Sheet.
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MMC Truth-in-Lending Act Exam Procedures
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Examination Procedures
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Yes
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No
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Examiner Notes [Document supporting evidence and note determinations and findings made.]
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1
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Coordinate compliance examination activities with other members of the examination team and the examiner-in-charge (EIC). Emphasize identifying violations of law and regulation; integrate those findings with the examination; and conclude on management's compliance with laws and regulations.
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2
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Review and evaluate the adequacy of policies, procedures, and internal controls to ensure the identification of applicable applicants and compliance with the requirements of TILA and FRB Regulation Z.
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3
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Determine whether the loan folder includes, as a minimum, the TIL Disclosure Statement, contractual documents, loan commitment, settlement statement, and, when applicable, the Right to Rescind/Cancel.
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4
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Determine whether the required disclosures were provided to the applicants/borrowers and if the disclosures were timely.
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5
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Determine whether the information provided in the disclosures was accurate, verify that the basic data is the same as other loan information and contractual documents, and the annual percentage rate. Compute amounts should be independently verified.
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6
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If the loan was a residential mortgage loan subject to RESPA and early disclosure was required, determine whether the good faith estimates of the required disclosures were furnished within 3 business days of receipt of the application.
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7
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If redisclosure was required, ascertain whether it was made prior to the consummation of the transaction.
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8
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If the right of rescission was applicable, determine whether the disclosures and a rescission notice were provided to each party with a right to rescind the transaction and whether the funds were not disbursed prior to the expiration of the rescission period unless a valid waiver of the right to rescind was obtained.
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9
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If the right of rescission was waived, determine whether it was properly documented by a dated statement describing the personal financial emergency justifying the waiver. Note: Printed forms are not acceptable.
NOTE: Testing of compliance with TIL on rejected applications is applicable only to rejected applications that were also subject to RESPA and should be done in the review of rejected applications for compliance with RESPA.
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10
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Conclude whether the institution is adequately complying with FRB Regulation Z. If not, ascertain whether the conclusion of noncompliance is supported by adequate documentation of the specific noncompliance.
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11
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Discuss items of concern, scope of work performed, and conclusions with the EIC.
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12
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Organize and compile, if necessary, violations of law and regulation into a Violation Summary Sheet.
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MMC Fair Credit Reporting Act Exam Procedures
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Examination Procedures
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Yes
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No
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Examiner Notes [Document supporting evidence and note determinations and findings made.]
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1
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Coordinate compliance examination activities with other members of the examination team and the examiner-in-charge (EIC). Emphasize identifying violations of law and regulation; integrate those findings with the examination; and conclude on management's compliance with laws and regulations.
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2
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Review and evaluate the adequacy of policies, procedures, and internal controls to ensure the identification of applicable applicants and compliance with the requirements of the FCRA.
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3
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Discuss with management the institution's activities related to collecting, reporting, supplying, and using credit information, and determine whether:
a. The institution uses credit information obtained from credit bureaus or other outside sources in evaluating consumer credit applications; and
b. The institution's activities make it subject to the consumer reporting agency requirements of the FCRA.
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4
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If the institution uses information from credit bureaus or other outside sources in evaluating consumer credit applications, coordinate the testing for compliance with the testing of rejected applications, and determine that the institution makes the disclosures required by FCRA as users of credit information.
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5
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Conclude whether the institution is adequately complying with the FCRA. If not, ascertain whether the conclusion of noncompliance is supported by adequate documentation of the specific noncompliance.
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6
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Utilize discussions with managers, as needed, to gather information and discuss procedures and practices followed by institution personnel to ensure compliance with laws and regulations.
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7
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Discuss items of concern, scope of work performed, and conclusions with the EIC.
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8
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Organize and compile, if necessary, violations of law and regulation into a Violation Summary Sheet.
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