To Lend or Not to Lend What the CRA Ought to Say about Sub-Prime and Predatory Lending
![handle is hein.journals/fclj7 and id is 9 raw text is: To LEND OR NOT TO LEND: WHAT THE CRA OUGHT TO SAY
ABOUT SUB-PRIME AND PREDATORY LENDING
Cassandra Jones Havard
I. INTRODUCTION
Thirty years ago, Congress passed legislation to ensure that people
living in racially segregated neighborhoods would have the economic
advantages that access to credit provides.' Today, there is a dire need to
scrutinize the broader economic and regulatory framework within which
the mortgage lending markets operate. The new issue of predatory lending
is both consistent with and diametrically opposite of the old problem of
credit denials based on race and property locations.
Congress passed the Equal Credit Opportunity Act of 1974
(ECOA) after congressional hearings revealed that commercial and
savings banks, private-mortgage companies, and savings and loan
institutions were denying credit to legitimate consumers and small
2
businesses, thereby hindering job creation and stable communities. Two
years later, Congress amended the Act based on the disturbing discovery
that lenders often denied credit to consumers based on gender, race, color,
national origin, marital status, religion, and age.3
* Associate Professor of Law, University of Baltimore School of Law; B.A., Bennett
College; J.D., University of Pennsylvania. I am indebted to Kimberlie Endres for her
excellent research and meticulous editing skills. This article has a companion piece,
Cassandra Jones Havard, Democratizing Credit:-Evaluating the Structural Inequities of
Sub-Prime Lending, 56 SYRACUSE L. REv. _ (forthcoming Winter 2006) (manuscript on
file with !he author). I would also like to thank the staff of the Florida Coastal Law
Review.
1 See generally Equal Credit Opportunity Act of 1974, Pub. L. No. 93-495, 88 Stat. 1500
(1974) (codified as amended at 15 U.S.C. § 1691 (1994)). See also Equal Credit
Opportunity Act Amendments of 1976, Pub. L. No. 94-239,90 Stat. 251 (1976) (codified
as amended at 15 U.S.C. § 1691 (1994)).
2 Congress passed The Community Reinvestment Act as Title VIII of the Housing and
Community Development Act of 1977, Pub. L. No. 95-128, 91 Stat. 1111 (1977)
(codified at 12 U.S.C. § 290 1(b) (1998)). The statute directs banks to meet the credit
needs of its entire community, including low- and moderate-income neighborhoods,
consistent with [the] safe and sound operation of the bank. Id.
3 During later hearings evaluating the statute's effectiveness, evidence was presented](ViewImageLocal?handle=hein.journals/fclj7&div=7&collection=journals&method=preview&ext=.png&size=3)
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To Lend or Not to Lend What the CRA Ought to Say about Sub-Prime and Predatory Lending
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