Function 3 · fair lending and adverse action · real HMDA data
Are some applicants denied more often than comparable applicants?
In New Jersey's 215,881 decided mortgage applications for 2024 and 2025, Black applicants were denied at 24.0% against 10.7% for white non Hispanic applicants. Holding income, loan size, loan to value, debt to income, loan type and purpose, the underwriting system and the lender fixed, the odds ratio falls from 2.63 to 1.76. The gap narrows and does not close, and the public file has no credit score or underwriting result, so what remains is a question to ask of a lender's own data, not a finding.
Denial disparities against the reference group, before and after adjustment
- Unadjusted odds ratio
- Adjusted odds ratio
Source: real:hmda, New Jersey HMDA 2024 and 2025, first lien owner occupied home purchase and refinance applications on 1 to 4 unit homes that reached a decision, as of 2026-08-31.
Denial rate by county, unadjusted and adjusted for the application mix
Source: real:hmda, New Jersey HMDA 2024 and 2025, first lien owner occupied home purchase and refinance applications on 1 to 4 unit homes that reached a decision, as of 2026-08-31.
Before adjustment
| Dimension | Group | Applications | Denials | Denial rate | Ratio to reference | 95% low | 95% high | BH q value |
|---|---|---|---|---|---|---|---|---|
| race and ethnicity | Black | 18,550 | 4,448 | 24.0% | 2.24 | 2.17 | 2.31 | 0.0000 |
| race and ethnicity | Not provided | 35,183 | 7,267 | 20.7% | 1.93 | 1.88 | 1.98 | 0.0000 |
| race and ethnicity | Hispanic or Latino | 28,971 | 5,010 | 17.3% | 1.62 | 1.57 | 1.67 | 0.0000 |
| race and ethnicity | Asian | 28,168 | 3,160 | 11.2% | 1.05 | 1.01 | 1.09 | 0.0172 |
| race and ethnicity | White non Hispanic (reference) | 95,397 | 10,214 | 10.7% | not applicable | not applicable | not applicable | not applicable |
| race and ethnicity | Other or joint | 9,612 | 951 | 9.9% | 0.92 | 0.87 | 0.98 | 0.0172 |
| sex | Not provided | 14,014 | 3,866 | 27.6% | 1.74 | 1.69 | 1.80 | 0.0000 |
| sex | Female | 45,462 | 7,258 | 16.0% | 1.01 | 0.98 | 1.04 | 0.5053 |
| sex | Male (reference) | 72,178 | 11,418 | 15.8% | not applicable | not applicable | not applicable | not applicable |
| sex | Joint | 84,227 | 8,508 | 10.1% | 0.64 | 0.62 | 0.66 | 0.0000 |
Source: real:hmda, New Jersey HMDA 2024 and 2025, first lien owner occupied home purchase and refinance applications on 1 to 4 unit homes that reached a decision, as of 2026-08-31.
After adjustment
Asian applicants are denied about as often as white non Hispanic applicants before adjustment (a rate ratio of 1.05) and carry an adjusted odds ratio of 1.42: on the observed controls their files are stronger, so equal files are denied more often. Adjustment can widen a gap as well as narrow one.
| Dimension | Group | Odds ratio | 95% low | 95% high | BH q value | Finding at q < 0.05 |
|---|---|---|---|---|---|---|
| race and ethnicity | Black | 1.76 | 1.67 | 1.85 | 0.0000 | higher odds of denial |
| race and ethnicity | Hispanic or Latino | 1.42 | 1.36 | 1.49 | 0.0000 | higher odds of denial |
| race and ethnicity | Asian | 1.42 | 1.34 | 1.49 | 0.0000 | higher odds of denial |
| race and ethnicity | Not provided | 1.40 | 1.33 | 1.47 | 0.0000 | higher odds of denial |
| race and ethnicity | Other or joint | 1.09 | 1.00 | 1.19 | 0.0539 | not distinguishable from the reference |
| sex | Not provided | 0.91 | 0.85 | 0.98 | 0.0136 | lower odds of denial |
| sex | Female | 0.88 | 0.84 | 0.91 | 0.0000 | lower odds of denial |
| sex | Joint | 0.76 | 0.73 | 0.79 | 0.0000 | lower odds of denial |
Source: real:hmda, New Jersey HMDA 2024 and 2025, first lien owner occupied home purchase and refinance applications on 1 to 4 unit homes that reached a decision, as of 2026-08-31.
The reasons lenders gave
Debt to income ratio is the most common first reason, on 31.6% of denials. Credit history comes first on 21.0% of denials to Black applicants against 18.3% for white non Hispanic applicants, and credit history is exactly what the public file leaves out.
| Reason for denial | Denials | Share | Share, White non Hispanic | Share, Black | Share, Hispanic or Latino | Share, Asian |
|---|---|---|---|---|---|---|
| Debt to income ratio | 9,820 | 31.6% | 30.9% | 33.8% | 36.8% | 35.3% |
| Credit history | 5,150 | 16.6% | 18.3% | 21.0% | 14.4% | 7.4% |
| Credit application incomplete | 4,980 | 16.0% | 13.6% | 11.9% | 11.2% | 13.5% |
| Collateral | 4,931 | 15.9% | 18.3% | 15.5% | 15.2% | 18.2% |
| Other | 2,530 | 8.1% | 8.3% | 7.5% | 9.1% | 9.7% |
| Unverifiable information | 1,618 | 5.2% | 4.9% | 4.0% | 6.1% | 7.0% |
| Insufficient cash | 1,577 | 5.1% | 4.4% | 4.9% | 5.2% | 7.2% |
| Employment history | 429 | 1.4% | 1.3% | 1.4% | 1.9% | 1.6% |
| Mortgage insurance denied | 15 | 0.0% | 0.0% | 0.0% | 0.1% | 0.0% |
Source: real:hmda, New Jersey HMDA 2024 and 2025, first lien owner occupied home purchase and refinance applications on 1 to 4 unit homes that reached a decision, as of 2026-08-31.
The proxy list, and the test that holds every model to it
32 protected attributes and proxies no credit or fraud model may use: age, applicant_age, applicant_zip5, birth_year, census_tract, city_pop, county_fips, customer_age, customer_lat, customer_long, date_of_birth_distinct_emails_4w, derived_ethnicity, derived_race, derived_sex, education, ethnicity, first_name, gender, last_name, lat, long, marital_status, marriage, name, name_email_similarity, national_origin, public_assistance_income, race, religion, sex, zip5, zip_code. Every published model's feature list is checked against it in the pipeline and in CI.
| Model | Features | Protected attributes or proxies among them |
|---|---|---|
| aml_triage | 13 | none |
| attrition | 18 | none |
| cure | 13 | none |
| fraud_account | 27 | none |
| fraud_card | 18 | none |
| pd_challenger | 13 | none |
| pd_scorecard | 8 | none |
| relief | 5 | none |
The scorecard's adverse action reasons come from the same discipline: the characteristics furthest below their best attainable points, never an entry on this list, and none for an approved applicant. Try it in the studio.
Method and limitations
- HMDA's public file has no credit score and no automated underwriting result. They are the variables a lender's own analysis controls for first, and their absence is the main reason an adjusted gap here is not a finding.
- Race, ethnicity and sex are HMDA's derived fields as applicants reported them. Applicants who did not report are their own group and are denied more often, which a lender's own review would look into.
- Lenders with too few applications, or no denials, share one fixed effect; the rest are compared within lender.
- Harborline Bank's own mortgage applications are generated, with no real HMDA filing behind them, so the method runs on the real New Jersey register, the data an examiner would start from.