NCRC applauds New York expansion of state Community Reinvestment Act to cover non-banks

Yesterday, New York Gov. Kathy Hochul signed legislation expanding the state’s version of the Community Reinvestment Act to apply the anti-redlining law’s obligations to nonbank mortgage lenders. CRA on a state level works to increase lending and community development activity as shown in a recent NCRC report. New York took an important step forward in expanding their law.

Jesse Van Tol, President and CEO of the National Community Reinvestment Coalition (NCRC), made the following statement:

“This is an important and pragmatic move by state lawmakers to expand access to home ownership in New York, and to ensure that non-bank mortgage companies, which now make the most mortgage loans, meet the same community reinvestment obligations as banks.

“I also want to congratulate NCRC members in New York for their leadership and advocacy for this change.

“New York is now among a group of states, including Illinois and Massachusetts, that have recognized the need to ensure that all lenders, not just banks, make mortgages available to credit-worthy borrowers in all communities. Now it’s time for Congress to update the federal Community Reinvestment Act, which still applies only to banks. All lenders should be held to the same standards, including credit unions and independent mortgage companies, which are now the biggest issuers of mortgages.

“We will continue to advise and support our local members and state lawmakers who want to enact or update state-level community reinvestment laws. I’m also encouraged by ongoing efforts at the federal banking agencies to strengthen and modernize CRA rules. But Congress will need to get involved to expand the law to cover lenders other than banks, and that change is long overdue.”

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

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