Examiners expect a bank’s fair lending testing to cover the underwriting, pricing, steering, redlining and marketing risks its own risk assessment identifies, through comparative file review and statistical analysis of HMDA and application data, with every flagged result reviewed by a person and documented.
This article sets out the 2026 scope of that testing, how examiners scope a review, the tests they run, the documentation they request, and how our Fair Lending Testing Agent applies as a solution.
Scope of Fair Lending Testing in 2026
Fair lending testing still rests on two statutes: the Equal Credit Opportunity Act, implemented by Regulation B, and the Fair Housing Act.
Federal examination scope has narrowed:
- OCC. Bulletin 2025-16, issued 14 July 2025, removed disparate impact from the Fair Lending booklet and directed examiners to stop examining for it.
- FDIC. On 29 August 2025 the FDIC removed disparate impact from the fair lending chapter of its Consumer Compliance Examination Manual.
- NCUA. On 4 September 2025 the NCUA removed disparate impact from its Fair Lending Guide and continues to examine for disparate treatment.
- CFPB. A final rule amending Regulation B, published 22 April 2026 and effective 21 July 2026, states that disparate impact claims are not cognizable under ECOA.
HUD proposed in January 2026 to remove its Fair Housing Act disparate impact rule and had not finalized the change by October 2026.
How Examiners Scope a Fair Lending Review
The Interagency Fair Lending Examination Procedures run in four parts:
- Scoping
- A compliance management review
- The examination procedures
- The conclusion
Scoping narrows the review to focal points defined by product, market, decision center, time frame, and the prohibited basis and control groups being compared.
The procedures list 55 risk factors across seven categories:
- Compliance program discrepancies (C1 to C7)
- Overt indicators (O1 to O5)
- Underwriting (U1 to U9)
- Pricing (P1 to P7)
- Steering (S1 to S8)
- Redlining (R1 to R12)
- Marketing (M1 to M7)
HMDA data does much of the selection before examiners arrive. A disparity in denial rates or in higher-priced lending by race or ethnicity, or a lending pattern that bypasses minority census tracts, marks a focal point. The OCC’s Fair Lending booklet provides for a request letter sent at least 45 days before the examination.
The Fair Lending Testing Examiners Run
Each examiner test has an equivalent that should already exist in the institution’s own program, and comparative file review and fair lending regression analysis carry most of the load:
| Test | Risk factors | Data it needs | Where a person reviews |
|---|---|---|---|
| Comparative file review | Underwriting | Marginal approved and denied files matched on credit characteristics | Each pair where treatment differs |
| Regression analysis | Underwriting, pricing | Application data with credit score, DTI, LTV and prohibited basis | Disparities that persist after controls |
| Pricing analysis | Pricing | Rate, rate spread, fees, discretion and compensation | Overages by loan officer |
| Steering analysis | Steering | Product placement by applicant group and channel | Placements in higher-cost products |
| Geographic analysis | Redlining | Applications by census tract, branches, CRA assessment area | Tracts with low activity against peers |
| Marketing review | Marketing | Campaigns, channels, prescreen criteria | Excluded areas or groups |
Comparative file review is the principal test for disparate treatment because it compares how two similar applicants were handled. Statistical analysis of the register shows where to look, and the file review shows what happened.
The Documentation Examiners Request
The 2009 procedures list what examiners ask to see:
- Underwriting guidelines
- Credit-scoring documentation
- Pricing policies and the rules governing discretion
- Loan officer and broker compensation
- The HMDA loan application register and lists of declined applications
- Exception and override records and how they are monitored
- Discrimination complaints
- Marketing materials
- The fair lending policies, training, monitoring and internal controls
Regulation B requires creditors to retain application records for 25 months after notifying the applicant of action taken. Its self-test privilege at 12 CFR 1002.15 protects the report and results of a voluntary self-test that creates data not already in loan files, provided the institution takes appropriate corrective action.
Where Ask Kaia and Predict360 Fit
Ask Kaia’s Fair Lending Compliance Testing Agent analyzes lending data and supporting evidence and identifies potential disparities for specialist review, and its HMDA Compliance Testing Agent checks LAR data against supporting loan files. Outputs carry citations and can be exported to Word or Excel, and each run leaves an execution history.
In Predict360, Issues Management assigns owners and due dates to findings, collects evidence and tracks actions through resolution, so the test result and its remediation sit in one record.
Frequently Asked Questions
Do Examiners Still Test for Disparate Impact?
The OCC, FDIC and NCUA no longer examine for disparate impact, following actions taken between July and September 2025, and the CFPB’s amended Regulation B states that disparate impact claims are not cognizable under ECOA. Disparate treatment remains prohibited and examined.
What Is Comparative File Review?
Comparative file review is a fair lending test that compares how an institution handled applicants from a prohibited-basis group with how it handled similarly qualified applicants from a control group. Examiners focus on marginal files, where approval or denial was a close call, because discretion is most visible there. Every difference in treatment needs a documented, non-discriminatory explanation.
Are Fair Lending Self-Tests Privileged?
Yes, within limits. Regulation B protects the report, results and data a voluntary self-test creates, when the test generates information not already in loan files and the institution takes appropriate corrective action on likely violations. The existence of the test, its methodology and the underlying loan records are not privileged, and voluntarily disclosing the results waives the protection.
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