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Litton_Fair_Lending_Policy2010 Powered By Docstoc
Effective Date: March 6, 2009
Revision Date : March 15, 2010
For: All Litton Loan Servicing LP

A. Introduction
       Litton Loan Servicing LP (“Litton”), a subsidiary of Goldman Sachs Bank USA (“GS
       Bank” or “Bank”), is committed to ensuring that all consumers receive fair and equal
       treatment in connection with loan servicing. The Fair Lending commitment of Litton is
       articulated by its Fair Lending Policy. All employees are responsible for fully
       complying with Litton’s Fair Lending Policy. 1

B. Fair Lending Policy Statement
       Litton Loan Servicing LP is committed to ensuring that all consumers receive fair and
       equal treatment in connection with loan servicing. To this end, it is the policy of Litton
       Loan Servicing LP to apply consistent loan servicing practices, inclusive of loss
       mitigation and loan modifications, regardless of a consumer’s race, color, religion,
       national origin, sex or sexual orientation, marital status, familial status, handicap, age
       (provided the consumer has the capacity to contract), military status, receipt of
       income from public assistance, the consumer’s good faith exercise of rights under
       the Consumer Credit Protection Act or any other prohibited basis.

C. Prohibition Against Overt Discrimination and Disparate Treatment
   and Impact
       Litton prohibits overt discrimination as well as disparate treatment and disparate
       impact that may be an unintended consequence of lending-related activity:
           •    Overt Discrimination (also known as Overt Disparate Treatment) is clear
                discrimination on a prohibited basis, such as a policy to not offer loan
                modifications to a given protected class, having different policies for single
                mothers and single women or evaluating foreign-born individuals differently
                than American born individuals.
           •    Comparative Disparate Treatment exists when a servicer treats a borrower
                differently on the basis of one of the prohibited factors and there is no
                credible, non-discriminatory explanation for the difference in treatment. For
                example, assessing different fees, levels of customer service, information and
                assistance on the basis of a prohibited factor, such as race, to similarly
                situated applicants.
           •    Disparate Impact exists when a servicer applies a neutral policy or practice
                equally to all borrowers but the policy or practice disproportionately excludes
                or burdens certain persons on a prohibited basis. An example of disparate

    Litton has adapted the GS Bank USA Fair Lending Policy to address specifically the servicing-related

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                                                       Litton Loan Servicing Fair Lending Policy

           impact is a prohibition on modifications for borrowers residing in homes that
           were built 10 years prior to origination.

D. Fair Lending Program
   GS Bank has established a comprehensive Fair Lending Program that has been
   approved by its Board of Directors. As a subsidiary of GS Bank, Litton is subject to
   the Bank’s Fair Lending Program. Key components of the Bank’s Fair Lending
   Program are as follows:
       The Board of Directors and senior management will review the Fair Lending
       Program and Policy on an annual basis. Bank senior management will receive
       periodic updates regarding fair lending matters.
       The Bank will ensure that applicable Bank personnel, including Litton receive fair
       lending training and that semi-annual updates are provided, as needed.
   Quality Control Review
       Quality control will perform a review on a sample of denied loan modifications to
       promote consistency in the loan modification process and ensure non-
       discriminatory practices.
   Underwriting Standards
       Litton will implement loss mitigation procedures to ensure consistent assistance
       and eligibility guidelines for all borrowers.
       Litton will apply consistent servicing standards from customer service through
       collections/foreclosure as well as providing information on the availability of loss
       mitigation options, timely processing of inquiries and sound practices pertaining
       to fee assessments and lender placed insurance policies.
   Third-Party Relationships
       Litton will affirm the fair lending obligations of third party providers of credit-
       related services.
       Litton will ensure prompt handling of customer complaints and inquiries
       concerning discrimination or unfair treatment.
   Fair Lending Risk Assessment
       The Bank will conduct an annual fair lending risk assessment to identify the fair
       lending laws and regulations applicable to Litton’s operations and to document
       the key controls in place at Litton.
   Compliance Testing and Audit Reviews
       The Compliance Testing Group (CTG) and Internal Audit will include fair lending
       considerations in their testing and audit plans where applicable in Litton’s
       business model.

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                                                     Litton Loan Servicing Fair Lending Policy

   Policy Updates
       This Policy will be reviewed periodically to ensure that it remains current with
       applicable fair lending laws and regulations.

E. Questions
   Questions regarding the Litton’s Fair Lending Policy should be directed to Litton’s
   Compliance Department. Questions regarding the Bank’s Fair Lending Program
   should be directed to the Bank’s Fair Lending Officer.

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                                                     Litton Loan Servicing Fair Lending Policy


   The fair lending laws and associated regulations include but are not limited to the

Fair Housing Act (FHA)

       The FHA makes it unlawful for a financial institution to deny any home-related
       loan because of race, color, religion, national origin, handicap, family status or
       sex. A variety of lending practices have been specifically designated as illegal
       and discriminatory under the FHA

Equal Credit Opportunity Act (ECOA), Regulation B

       ECOA makes it unlawful for a financial institution to discourage anyone from
       applying for a loan or discriminate, on a prohibited basis, against any loan
       applicant. Prohibited bases include race, color, religion, national origin, sex,
       marital status, age, or source of income. ECOA also impacts the handling of loan
       applications and the notification of lending decisions to applicants.

New York’s Executive Law Section 296-a

       New York’s Executive Law Section 296-a makes it unlawful for any creditor or
       any officer, agent or employee to discriminate in the case of applications for the
       granting, withholding, extending, renewing of credit or in the fixing of interest
       rates, terms or conditions of any form of credit on the basis of race, creed, color,
       national origin, sexual orientation, military status, age, sex, marital status,
       disability or familial status.

Home Mortgage Disclosure Act (HMDA), Regulation C

       HMDA requires lenders to collect and submit data on home-purchase and home-
       improvement loans as well as refinances of home-secured loans. The lender’s
       Loan Application Register (LAR) must be made available to the public upon
       request. HMDA data helps to identify possible discriminatory lending patterns
       and assists regulatory agencies in enforcing compliance with anti discrimination

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