What is the Community Reinvestment Act?

The Community Reinvestment Act (CRA) is a federal law enacted in 1977 that encourages banks and other depository institutions to help meet the credit needs of the communities in which they operate. Over the years, the law has been updated and strengthened in order to ensure banks are helping to meet the needs of low- and moderate-income areas, as well as preventing them from discriminating against those areas. In Delaware, the CRA requires banks to make mortgage loans, small business loans, and other types of credit available to people in the community. Banks must also provide banking services to those who might otherwise be excluded. All banks in Delaware are monitored by the Federal Deposit Insurance Corporation (FDIC) to make sure they are complying with the CRA regulations. The FDIC will take action if a bank fails to follow the regulations, including fines or even the loss of its deposits if it is deemed to be in violation of the law. Banks must also make available public reports of how they are addressing the credit needs of their community. The CRA has been widely successful in helping to bring credit to communities that may not have otherwise had access to it, as well as encouraging banks to be more responsible about their lending practices.

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What is the Community Reinvestment Act?

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