Community Reinvestment Act

(redirected from Community reinvestment)

Community Reinvestment Act (CRA)

Enacted by Congress in 1977, the CRA encourages banks to help meet the credit needs of their communities for housing and other purposes, particularly in neighborhoods with low or moderate incomes, while maintaining safe and sound operations.

Community Reinvestment Act

A 1977 U.S. law encouraging banks and other lending agencies to extend credit to low and moderate income persons wishing to buy a home. The original contained no penalties, but prohibited lending institutions from discriminating against a potential homeowner based on where he/she lives. Regulatory changes in 1995 and legislative amendment in 1999 are often blamed for encouraging banks to make excessively risky loans in exchange for the ability to offer investment and insurance services. Because of this, some believe the CRA is responsible for the housing bubble that contributed to the recession that began in 2008. See also: Credit Crunch, Gramm-Leach-Bliley Act

Community Reinvestment Act (CRA)

An act passed by Congress in 1977 to encourage financial institutions to meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods. Compliance is monitored via regular audits,and a poor record of CRA compliance is taken into consideration when the financial institution applies for deposit facilities,including mergers and acquisitions.

One may find a financial institution's rating for CRA compliance by visiting the Web sites of the various regulatory agencies that track compliance.A financial institution may appear on one list but not others, depending on which agency has responsibility for that bank and its CRA compliance. The possibilities are

Federal Reserve Board (www.federalreserve.gov)
FDIC (www.fdic.gov)
Office of Comptroller of the Currency (www.occ.treas.gov)
Office of Thrift Supervision (www.ots.treas.gov)

Mentioned in ?

References in periodicals archive ?

Advisory Services and Regulatory Relations, will join a panel of senior industry executives to discuss whats ahead for the Community Reinvestment Act, as well as the Low-Income Housing Tax Credit and Home Mortgage Disclosure Act reform efforts under a new Administration.

Netherlands : Wolters Kluwer Regulatory Expert Timothy R. Burniston to Speak at CBA Live

The New York State Banking Department has given Gold Coast Bank a Community Reinvestment Act (CRA) rating of "Outstanding," the highest rating possible.

Gold Coast Bank earns top rating for reinvestment

Lynn Archuleta to take additional role as Solera National Bank's community reinvestment act officer

Solera National Bank appoints community reinvestment act officer

Specifically, they blamed the Community Reinvestment Act, which banned banks from redlining and opened up neighborhoods to homeowners of color.

Putting the cash where it matters: a new bill in Congress would expand the law that barred banks from redlining

The court decision is especially critical to reporters and editors like Matthew Lee, whose non-profit organization includes cutting-edge advocacy, reporting, and organizing in the fields of community reinvestment, fair access to credit, insurance, telecommunications, environmental justice, and government and corporate human rights accountability--on a global scale.

Newsletter editor-publisher wins major Freedom of Information court decision

The nonprofit National Community Reinvestment Coalition helps free consumers from the trap of usurious interest rates and exorbitant mortgage payments.

Refinancing predatory mortgage loans: new fund rescues homeowners from usurious interest rates

The committee has also proposed a revision to the Community Reinvestment Act.

Resignation of Governor Edward M. Gramlich

In an effort to ensure that the Community Reinvestment Act (CRA) remains an effective fair lending tool in the changing financial marketplace, Representatives Tom Barrett (D-Wis.

CRA Modernization Bill Introduced in House

Insurers are not covered by the federal Community Reinvestment Act, but consumer advocates gave a presentation on a similar, but voluntary, program in Massachusetts in which 25 insurers participate.

Insurers Urged to Reinvest in Community

Besides the dispute over privacy, the bill was snagged for months by a fight between Gramm and Clinton over the senator's opposition to rolling the Community Reinvestment Act into the legislation.

BANKING OVERHAUL; DEAL WOULD ALLOW MERGING OF FINANCIAL SERVICES

SAN FRANCISCO -- The Federal Reserve Banks of Boston and San Francisco announced today the publication of a collection of research papers and essays on the Community Reinvestment Act (CRA).

Boston and San Francisco Federal Reserve Publication Captures Views on Community Reinvestment Act Reform