Real EstateFeds propose first major revamp to fair housing rules...

Feds propose first major revamp to fair housing rules since 1995

Lumber at the site of a house under construction in the Cielo at Sand Creek by Century Communities housing development in Antioch, California, U.S., on Thursday, March 31, 2022.

David Paul Morris | Bloomberg | Getty Images

Bank regulators on Thursday proposed the first sweeping changes in more than 25 years to a controversial law aimed at increasing lending to low- and moderate-income communities.

The changes would tailor the Community Reinvestment Act’s approach to making sure banks are not engaging in “redlining,” or refusing to put money in areas often populated by minorities and lower wage earners.

Passed in 1977, the act has been a sore spot among some banks, particularly larger lenders, who complain about the costs and reporting burdens. However, affordable housing advocates say the CRA has been pivotal in providing equal housing opportunities.

“The CRA is one of our most important tools to improve financial inclusion in communities across America, so it is critical to get reform right,” Fed Vice Chair Lael Brainard said. “It evaluates bank engagement across geographies and activities in order to ensure the CRA is effective in supporting a robust and inclusive financial services industry.”

Since the last CRA revisions, online and mobile banking has become a major part of the finance industry without more specific guidelines for how they will be evaluated under fair housing guidelines.

The changes look to offer clearer public benchmarks for evaluation while allowing smaller banks to continue operating under the former rules.

Larger lenders have pushed back against the CRA expansion, saying that the rules would add to their costs and are overreaching.

Fed Governor Michelle Bowman said she generally supports the opportunity for revisions but expressed hesitation about the ramifications in the new proposal.

For instance, she noted that banks with assets greater than $10 billion would be subject to a raft of new disclosure requirements involving car loans, mobile and online banking services and community development funding.

“While I support issuing the proposed rule for public comment, there are significant unanswered issues posed by the proposal,” Bowman said. “Fundamentally, we do not know if the costs imposed under the proposal will be greater than the benefits.”

The proposal seeks public comment through Aug. 5, with anticipation that it would take effect a few months after publication in the Federal Register.

Original Source Link


Please enter your comment!
Please enter your name here

Latest News

Nevada joins Oregon, Washington in discount prescription program

Nevada's governor on Thursday said the state is launching a prescription discount card, a method of softening the...

Why the Political Grift Won’t Stop

It didn't take long after New York Attorney General Letitia James announced her $250 million fraud lawsuit against...

Collagen vs whey protein: Which is better?

The fight is on: collagen vs whey protein. But which one is better for improving muscle development and...

Inside the $250 million penthouse on ‘Billionaires’ Row’

A penthouse atop the world's tallest residential building − listed for $250 million − is marking the biggest...

Prince Harry Ending His Rift With King Charles & Prince William Was One Of The Queen Elizabeth’s ‘Dearest Wishes’

Queen Elizabeth II held onto hope that Prince Harry would end his feud with the royal family until...

Must Read

Logitech device aimed at $32B portable gaming market

Logitech, the $5 billion company best known for...
- Advertisement -

You might also likeRELATED
Recommended to you