Editing Community Reinvestment Act (section)

===Original act===
The CRA followed similar laws passed to reduce discrimination in the credit and housing markets including the [[Fair Housing Act]] of 1968, the [[Equal Credit Opportunity Act]] of 1974 and the [[Home Mortgage Disclosure Act]] of 1975 (HMDA). The Fair Housing Act and the Equal Credit Opportunity Act prohibit discrimination on the basis of race, sex, or other personal characteristics. The Home Mortgage Disclosure Act requires that financial institutions publicly disclose mortgage lending and application data. In contrast with those acts, the CRA seeks to ensure the provision of credit to all parts of a community, regardless of the relative wealth or poverty of a neighborhood.<ref name="Braunstein"/><ref name="SandraThompson">[http://www.fdic.gov/news/news/speeches/archives/2008/chairman/spfeb1308.html Prepared Testimony of Ms. Sandra L. Thompson], Director, Division of Supervision and Consumer Protection, FDIC, ''before the Committee on Financial Services'', ''U.S. House of Representatives'', February 13, 2008.</ref>

Before the Act was passed, there were severe shortages of credit available to low- and moderate-income neighborhoods. In their 1961 report, the [[U.S. Commission on Civil Rights]] found that African-American borrowers were often required to make higher [[downpayment]]s and adopt faster repayment schedules. The commission also documented blanket refusals to lend in particular areas ([[redlining]]).<ref name="civil-1961">
{{cite book|title= Report by the U.S. Commission on Civil Rights|publisher=United States Commission on Civil Rights|year=1961|url=http://www.law.umaryland.edu/marshall/usccr/documents/cr11961bk4.pdf|access-date=2008-10-06|volume=4}}</ref>

The allegations of "redlining" certain neighborhoods originated with the [[Federal Housing Administration]] in the 1930s. The "residential security maps" created by the [[Home Owners' Loan Corporation]] (HOLC) for the FHA were used by private and public entities for years afterwards to withhold mortgage capital from neighborhoods that were deemed "unsafe".<ref name="jackson">{{cite crabgrass}}</ref> Contributory factors in the shortage of direct lending in low- and moderate-income communities were a limited secondary market for mortgages, informational problems to do with the lack of credit evaluations for lower-income borrowers, and lack of coordination among credit agencies.<ref name="Carter1978">{{cite web|url=http://www.presidency.ucsb.edu/ws/print.php?pid=30567|title=Role of Private Financial Institutions|work=National Urban Policy Message to Congress|publisher=The American Presidency Project, U. of C.|date=1978-03-27|page=President Carter|access-date=2009-04-19|archive-date=2016-03-03|archive-url=https://web.archive.org/web/20160303221748/http://www.presidency.ucsb.edu/ws/print.php?pid=30567|url-status=dead}}<blockquote>An effective urban strategy must involve private financial institutions. I am asking the independent financial regulatory agencies to develop appropriate actions, consistent with safe, sound and prudent lending practices, to encourage financial institutions to play a greater role in meeting the credit needs of their communities. First, I am requesting that financial regulatory agencies determine what further actions are necessary to halt the practice of redlining—the refusal to extend credit without a sound economic justification. I will encourage those agencies to develop strong, consistent and effective regulations to implement the Community Reinvestment Act</blockquote></ref><ref name="Braunstein"/><ref name="SandraThompson"/>

In Congressional debate on the Act, critics charged that the law would create unnecessary regulatory burdens. Partly in response to these concerns, Congress included little prescriptive detail and simply directs the banking regulatory agencies to ensure that banks and savings associations serve the credit needs of their local communities in a safe and sound manner.<ref name="Bernanke"/><ref name="Braunstein"/> Community groups only slowly organized to take advantage of their right under the Act to complain about law enforcement of the regulations.<ref name="Schwartz">Schwartz, A., [http://www.innovations.harvard.edu/showdoc.html?id=3275 From confrontation to collaboration?] {{Webarchive|url=https://web.archive.org/web/20081206015637/http://www.innovations.harvard.edu/showdoc.html?id=3275 |date=2008-12-06 }}, ''Banks, community groups, and the implementation of community reinvestment agreements'', Fannie Mae Foundation, 3, pp. 631-662 (1998).</ref>