Fair Lending Analysis of Mortgage Pricing: Does Underwriting Matter?

This paper focuses on potential interaction between the mortgage underwriting and pricing decisions for fair lending analysis of mortgage pricing. We argue that the loan approval or denial decision determines the loan origination population and therefore the underwriting policies might affect the fair lending assessment of the subsequent pricing decisions. The paper also finds that sample selection bias test and estimation are subject to omitted variables and recommends the study of banks' lending policies to better incorporate the decision-making process in fair lending analysis.

• | Author: Office of the Comptroller of the Currenc
• | Publisher: Createspace Independent Publishing Platform
• | Publication Date: Jan 01, 2015
• | Number of Pages: 32 pages
• | Binding: Paperback or Softback
• | ISBN-10: 1505375754
• | ISBN-13: 9781505375756