ABSTRACT
This chapter explains the importance of beginning a loan file review with the bottom line, that is, external patterns. It examines the application process from loan origination to decision-making, identifying where and how discrimination can occur at each stage. The chapter explores the loan file for the crucial pieces of information, their location in the file, what to analyze, and how to use a database to look for differential treatment. It presents a three part remedy: individual remedy to victims; neighborhood remedy to minority neighborhoods; and affirmative action to correct and overcome the effects of past discrimination. The loan originator is the “in-take” worker, the person who works with realtors and/or directly with individuals who need a mortgage. Loan processing is the stage between the lender’s receipt of an application and closing, rejection or withdrawal of an application. The loan processing log, originated on paper or computer-generated, is generally an accurate diary of the lender’s processing and the underwriter’s decisions.
