What is the Community Reinvestment Act?

The Community Reinvestment Act (CRA) is a federal law that was enacted in 1977 to ensure that financial institutions such as banks and savings and loan associations are investing in their local communities. In Tennessee, this law requires banks to provide services and products that meet the credit needs of the communities they have been granted to serve, including low- and moderate-income individuals. The CRA also requires banks to disclose their investments and services to the public. Under the CRA, banks are evaluated periodically by the federal government for their compliance with the law. The CRA focuses on three primary areas of investment: loan origination, investments, and services. Banks must make an effort to make loans available in all areas of their community, regardless of income levels. Banks must also invest in projects that will benefit their communities, such as affordable housing, job training, and economic development. Banks must also offer services such as financial literacy programs to help members of their community access financial services. The CRA encourages banks to serve their communities in a manner that meets the needs of all individuals. This law has helped ensure that financial institutions in Tennessee are able to assist residents of all income levels. Banks that do not comply with the CRA may be subject to restrictions or sanctions.

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What is the Community Reinvestment Act?

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