Quintessential Mortgage Group, LLC (Quintessential) is committed to doing its part to ensure fair, equitable, and nondiscriminatory access to credit for both individuals and communities, by providing mortgage loan financing and brokerage services to applicants and borrowers on an equal basis, under the appropriate license or registration type applicable to the jurisdictions in which Quintessential is authorized to provide such services, and to comply with all applicable Federal and State Consumer Finance laws and regulations.
It is Quintessential’s policy to treat all of its applicants and borrowers consistently and in compliance with Fair Lending Laws, throughout the loan process, from application to closing, including post-closing, as may be applicable to the transaction. In connection with the organization’s fair financing philosophy and its obligation under law, Quintessential has established an effective compliance management system, including effective fair financing compliance management systems, which are adapted to its business strategy and operation.
Quintessential engages in careful monitoring for compliance with fair financing laws to manage fair financing risk and to mitigate against inadvertent or deliberate non-compliance. Accordingly, Quintessential’s management leads by example, and ensure the appropriate training to ensure employee compliance, and employs effective vendor management systems to ensure that third parties that provide services to Quintessential are compliant with required fair financing laws.
The legal aspects of fair financing are contained in several federal and state laws. The purpose of these laws is to ensure that fair and equal treatment is provided to consumers of financial financing products and services, covered under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) (§ 1013(c)(2)(D) of Public Law 111203), such as the Equal Credit Opportunity Act (ECOA) (15 U.S.C. § 1691f), the Home Mortgage Disclosure Act (HMDA) (12 U.S.C. § 2807) and The Truth in Lending Act (TILA) (15 U.S.C. § 1602).
i. ECOA – to “facilitate enforcement of fair financing laws and enable communities, governmental entities, and creditors to identify business and community
development needs and opportunities of women-owned, minority-owned, and small businesses” (Dodd-Frank Act § 1071);
ii. HMDA – to require mortgage providers to collect and report additional data fields (Dodd-Frank Act § 1094); and
iii. TILA – to “prohibit . . . abusive or unfair financing practices that promote disparities among consumers of equal credit worthiness but of different race, ethnicity, gender, or age” (Dodd-Frank Act § 1403).
The ECOA and its implementing regulation, Regulation B, the HMDA, and its implementing Regulation C, and TILA, and its implementing Regulation Z, prohibit discrimination in any aspect of a credit transaction. The prohibited bases of discrimination under the ECOA are the following:
The ECOA prohibits discrimination based on:
1) Race or color
3) National origin
5) Sexual Orientation
6) Gender Identity
7) Marital status
8) Age (provided the applicant has the capacity to contract)
9) The applicant’s receipt of income derived from any public assistance program
10) The applicant’s exercise, in good faith, of any right under the Consumer Credit Protection Act.
In addition to the fair financing laws indicated above, The Fair Housing Act (FHAct) (24 CFR 100) prohibits discrimination in all aspects of “residential real-estate related transactions,” including but not limited to:
1) Making loans to buy, build, repair, or improve a dwelling
2) Purchasing real estate loans
3) Selling, brokering or appraising residential real estate
4) Selling or renting a dwelling.
The FHAct prohibits discrimination based on:
1) Race or color
2) National origin
5) Sexual Orientation
6) Gender Identity
7) Familial status (defined as children under the age of 18 living with a parent or legal custodian, pregnant women, and people securing custody of children under 18)
Under both the ECOA and the FHAct, it is unlawful for a provider to discriminate on a prohibited basis in a residential real-estate-related transaction. Under one or both of these laws, Quintessential may not, because of a prohibited factor:
1) Fail to provide information or services or provide different information or services regarding any aspect of the financing process, including credit availability, application procedures, or financing standards;
2) Discourage or selectively encourage applicants with respect to inquiries about or applications for credit
3) Refuse to extend credit or use different standards in determining whether to extend credit
4) Vary the terms of credit offered, including the amount, interest rate, duration, or type of loan
5) Use different standards to evaluate collateral
Under the FHAct, a provider shall not express, orally or in writing, a preference based on prohibited factors, or indicate that it will treat applicants differently on a prohibited basis. A violation may still exist even if a provider treated applicants equally. A provider may not discriminate on a prohibited basis because of the characteristics of:
1) An applicant, prospective applicant, or borrower
2) A person associated with an applicant, prospective applicant, or borrower (for example, a co-applicant, spouse, business partner, or live-in aide)
3) The present or prospective occupants of either the property to be financed or the characteristics of the neighborhood or other area where property to be financed is located.
The FHAct requires providers to make reasonable accommodations for a person with disabilities when such accommodations are necessary to afford the person an equal
Various state laws also govern Fair Lending, including, but not limited to, New York Executive Law § 296- a, which makes it an unlawful discriminatory practice for any creditor to discriminate on the basis of race, creed, color, national origin, age, sex, sexual orientation, gender identify, marital status, disability, sexual orientation, or military status; to use any form of application for credit or use or make any record or inquiry which expresses, directly or indirectly, any limitation, specification, or discrimination as to a prohibited basis; to make any inquiry of an applicant concerning his or her capacity to reproduce, or his or her use or advocacy of any form of birth control or family planning; to refuse to consider sources of an applicant’s income or to subject an applicant’s income to discounting, in whole or in part, because of a prohibited basis or childbearing potential; or to discriminate against a married person because such person neither uses nor is known by the surname of his or her spouse.
The purpose of Quintessential’s fair financing policy is to ensure fair, equitable, and nondiscriminatory access to credit for both individuals and communities; to ensure that management and staff can identify fair financing risks and can mitigate and prevent such risks of abusive or unfair financing practices that promote disparities among consumers of equal credit worthiness on any unlawful or prohibited discriminatory basis.
Quintessential’s commitment to fair financing is reflected in its belief in the shared responsibility for compliance with fair financing laws at every level of the organization. The Managing Members are responsible for approving, adopting, and implementing the Fair Lending Plan.
• Robert Miller is designated as Quintessential’s Chief Compliance Officer
• Anthony Forte is designated as Quintessential’s Chief Lending Officer
• David Linn has oversight of the company’s Fair Lending Plan.
Quintessential’s Management is responsible for ensuring that Quintessential’s business practices comply with its Fair Lending Plan in the following ways:
i. Communicating Quintessential’s fair financing policies to the applicable business unit management;
ii. Allocating, on an ongoing basis, sufficient resources to ensure the successful implementation of this Plan;
iii. Obtaining input and guidance from its Compliance Counsel on significant business decisions that have potential fair financing impact; and
iv. Monitoring results and recommending corrective action where necessary.
Quintessential’s Chief Compliance Officer implements the policies outlined in this Plan in the following ways:
i. Monitoring implementation of and adherence to the fair financing policies and procedures;
ii. Reviewing and addressing fair financing complaints;
iii. Monitoring, as appropriate, Quintessential’s loan application and underwriting process as well as its pricing policies;
iv. Reviewing, on a regular basis, the fair financing plan to determine that it still accurately reflects the procedures followed by Quintessential and conforms to federal and state law;
v. Maintaining training materials to keep current with changes in the law, regulation, and judicial interpretation; and
vi. Providing, at least semi-annually, updates on fair financing issues to all Quintessential employees involved in the loan origination process.
Quintessential ensures training for all new and current employees. Training for new employees covers the requirements of fair financing under the Equal Credit Opportunity Act, Regulation B, the Home Mortgage Disclosure Act, Regulation C, TILA, Regulation Z, and applicable state laws. Quintessential’s training includes management and staff. The goal of the training program is to ensure that all Quintessential personnel understand the federal fair financing laws that govern our organization. The training objectives are as follows,
i. Facilitate employee and management understanding of fair financing laws.
ii. Discuss how Quintessential incorporates these laws into specific operational practices.
iii. Define the role of employees in the implementation of these practices.
iv. Provide ongoing awareness training to ensure that Quintessential’s fair financing policy and procedures are being adhered to.
The Compliance Officer reviews and must approve, prior to distribution, all marketing strategies directed to any protected class applicants or minority communities to ensure compliance with fair financing laws. The Compliance Officer also periodically reviews such existing marketing strategies to confirm that they remain in compliance with fair financing laws.
Quintessential is prohibited from using any words, phrases, symbols, or forms that might convey discriminatory preferences or limits when advertising consumer or residential property loans. This includes overt or tacit discrimination based on race, color, religion, sex, sexual orientation, gender identity, handicap, family status, or national origin. The following practices are considered discriminatory and may not be used in Quintessential’s advertising:
1) Limit marketing and advertising to a specific geographic area within Quintessential’s field of customers.
2) Use language selectivity (such as using only English in an area where the majority of the members or potential members are non-English-speaking).
3) Exclude some media.
4) Use billboard advertising that is placed only in certain demographic areas.
5) Limit distribution of brochures within a selected zip code zone.1) Limit marketing and advertising to a specific geographic area within Quintessential’s field of customers.
6) Exclude specific types of human models in advertising for residential property loans.
Quintessential is aware that the risk of unfair financing practices exists in the loan origination process. Quintessential is committed to implementing training and policies that protect against discriminatory practices at every level of the loan process, from application to post-closing and delivery of the loan on the secondary market, and to taking immediate corrective action should fair financing discrimination occur. For example, if fair financing deficiencies are observed or appear in an employee’s job evaluation, the employee will receive additional training or counseling in an effort to correct the deficiency. If the deficiency persists, the employee will be subject to additional corrective action, including termination.
Where Quintessential acts as creditor on a transaction, it establishes or adopts underwriting guidelines reduced to writing by policy and procedure, to promote and ensure consistency in the treatment of all classes of applicants. The guidelines address all aspects of the underwriting process, including collateral standards, credit, income, source of funds, debt ratios, income documentation and other factors relevant to the underwriting analysis and credit decision. Quintessential will offer borrowers the best available products for which the borrower qualifies based on his/her creditworthiness, documented income and ability to repay the loan requested. Loan applications that are adversely decisioned by Quintessential are subject to second review prior to formal denial of credit.
This plan’s principles of fair financing policy apply throughout the loan process, and Quintessential is committed to implementing policies, procedures, employee training, and management oversight to ensure equitable treatment of all debtors. Quintessential’s policies include responding to consumer inquiries, concerns, and complaints in a timely, fair, and consistent manner.
Quintessential implements monitoring processes that review the financing practices of the institution as a whole as well its various departments, and individuals within the departments. Quintessential’s monitoring program focuses on detecting deficiencies and ensuring that Quintessential’s personnel understand their duties and responsibilities under this plan and are carrying them out. The Compliance Officer ensures ongoing review of loan files to monitor data integrity and compliance.
Quintessential retains the following for 5 years from loan origination,
1) Complete mortgage loan files, including applications and disclosures
2) Real estate appraisals
3) Adverse action notices
4) Written statements alleging discrimination, if applicable
No officer, employee, or other agent of Quintessential shall discourage any applicant from applying for or seeking credit on the grounds of any prohibited basis. All applications, whether individual or business, written or oral, in person or by telephone, will be similarly and fairly evaluated fairly. All application evaluation systems used by Quintessential will not discriminate among applicants on any prohibited bases. Quintessential will not discriminate on the basis of any of the prohibited factors in any aspect of the loan application, in any manner whatsoever.
Under the ECOA and the Fair Housing Act, Quintessential may not, on a prohibited basis:
1) Fail to provide information or services or provide different information or services regarding any aspect of the financing process, including credit availability, application procedures, or financing standards.
2) Discourage or selectively encourage applicants with respect to inquiries about an application for credit.
3) Refuse to extend credit or use different standards in determining whether to extend credit.
4) Vary the terms of credit offered, including the amount, interest rate, duration, or type of loan.
5) Use different standards to evaluate collateral.
6) Use different standards for pooling or packaging loans in the secondary market.
7) Express, orally or in writing, a preference for or against applicants in a protected class.
8) Discriminate based on the present or prospective occupants of the location of the property to be financed.
Quintessential is required to notify one of the applicants on the credit application of Quintessential’s decision, favorable or adverse, with respect to a completed application within 30 days of receipt of the completed application at Quintessential. If any applicant
has not furnished Quintessential with all of the information requested on the application or that is normally received for the type of credit being requested, the application will be considered incomplete and the applicant will be notified within 30 days that additional information will be needed. A notice of favorable or adverse action will be provided.
1) Notification of Favorable Action
Notification is to be given in the form of a notice of the loan approval and/or disbursement of the loan proceeds.
2) Notification of Adverse Action
Notification is to be given to the applicant in a written notice containing a statement of the action taken, the name and address of Quintessential, the ECOA notice contained in paragraph 1002.9(b)(1) of Regulation B, and one of the following:
(i) A statement of the specific reasons for the action taken
(ii) Disclosure of the applicant’s right to receive such a statement within 30 days of the applicant’s request (in the latter event, the applicant’s request must be
received within 60 days of the adverse action notice)
(iii) The name, address, and telephone number at which the statement of specific reasons for the adverse action may be requested
3) Incomplete Applications
If an application does not contain all the information needed to make a credit decision and Quintessential does not choose to deny the application on this basis, Quintessential will provide the applicant with a notice within 30 days after receipt that the application is incomplete. This notice must contain, at a minimum, the following:
(i) An itemized list of the information needed to complete the application
(ii) A reasonable time frame for providing the information
(iii) A notice that failure to provide the additional information will result in Quintessential not considering the application for credit
This policy will be reviewed and updated to comply with any changes or revisions to existing regulations that may affect the policy. The Chief Lending Officer and Chief Compliance Officer will assume responsibility for this compliance review and revision process. Additionally, the Managing Members shall review the policy on an annual basis to ensure that the policy is current and that procedures of its implementation are in place and are adequate.
The CEO of Quintessential Mortgage Group, LLC has approved this Fair Lending Policy as reasonably designed to ensure fair, equitable, and nondiscriminatory access to creditfor both individuals and communities, and to achieve Quintessential Management’s ongoing compliance with the foregoing and all applicable laws, regulation, rules and guidelines.
• Management’s Last Policy Review: December 14, 2022
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