Community Reinvestment Act

Housing Finance

Resolved that the National Association of Home Builders urge the Congress and the federal banking regulators to amend the Community Reinvestment Act (CRA) regulations, guidance and processes as follows:

  1. Develop a list of “safe harbor” federal, state and local financing programs for affordable housing to provide more clarity on which activities constitute affordable housing.
  2. Provide more and better training for examiners, financial institutions and stakeholders (developers, syndicators, community leaders) on the CRA guidance as it relates to the definition of community development and what constitutes affordable housing.
  3. Modernize the process for establishing assessment areas to ensure that the broadest range of communities benefit from CRA.
  4. Increase the rigor of the CRA exam criteria, reduce subjective elements and increase penalties for noncompliance.
  5. Work with stakeholders to develop a meaningful set of incentives that would encourage financial institutions to strive for an Outstanding rating.
  6. Adopt a process that would allow a financial institution to receive CRA credit for investments outside their assessment areas, but within the state or region, if they can demonstrate a lack of opportunity or need in one or more of their local assessment areas.

Further resolved that the National Association of Home Builders reaffirm the following current policy that NAHB should:

  1. Oppose administrative or Congressional efforts to weaken CRA by exempting institutions from CRA requirements or further reducing CRA reporting requirements;
  2. Work with state and local home builders associations to monitor the housing lending performance of banks and thrifts in the associations' areas;
  3. Support Community Reinvestment Act challenges when evidence exists that the institution purchasing another institution has not served the housing credit needs of the community or is likely to significantly disrupt outstanding or future credit for housing in the area following the acquisition.
Resolution originally adopted: 2010.9, Resolution No. 16

Committee with primary jurisdiction:
  • Housing Finance Committee
Full Resolution The full text of this resolution is available for download