How can mortgage discrimination be prevented?

Here are some steps you can take to deny lenders even the opportunity to discriminate against you:

1. Make your financial credentials hard to resist.
2. Apply online for greater anonymity.
3. Talk to multiple lenders.
4. Try prequalification or mortgage preapproval.
5. Save a copy of your application.

Is the CRA still relevant to mortgage lending?

Our analysis points to a conclusion that the CRA continues to be relevant to maintaining broad access to mortgage credit. We find that the overall share of loans to low-or moderate-income borrowers has decreased compared to pre-2004, which we view as a reasonable benchmark period.

What act prohibits discrimination in lending?

The federal fair lending laws—the Equal Credit Opportunity Act and the Fair Housing Act—prohibit discrimination in credit transactions, including transactions related to residential real estate.

What are the potential penalties for discrimination in lending?

Civil penalties of up to $10,000 for each initial violation and up to $25,000 and $50,000 for successive violations within specific time frames.

What is CRA mortgage?

CRA is an acronym for the Community Reinvestment Act, a U.S. law encouraging banks to help meet credit needs in communities where they take deposits, with specific emphasis on helping meet credit needs of low- and moderate-income neighborhoods.

What does CRA stand for in mortgage?

The Community Reinvestment Act (CRA) was. enacted in 1977 to prevent redlining. 1. and to. encourage banks and savings associations (collectively, banks) to help meet the credit needs of all segments of their communities, including low- and moderate-income neighborhoods and individuals.

What do fair lending and anti discrimination laws apply to?

These fair lending laws prohibit lenders from discriminating in credit transactions on the basis of race, color, national origin, religion, sex, and other specified grounds.

What type of discrimination is it when a lender treats similarly situated applicants differently for no apparent reason other than a prohibited basis?

Disparate treatment occurs when a lender treats a credit applicant differently based on one of the prohibited bases. It does not require any showing that the treatment was motivated by prejudice or a conscious intention to discriminate against a person beyond the difference in treatment itself.

Which CRA test is weighted more heavily?

lending test
Evaluations are based on lending, investment and service tests; for most banks, the lending test is weighted most heavily in determining the overall rating.

Why is CRA important to banks?

The Community Reinvestment Act (CRA) is a law intended to encourage depository institutions to help meet the credit needs of the communities in which they operate, including low- and moderate-income (LMI) neighborhoods, consistent with safe and sound banking operations.