NCRC Statement on Johnson and Crapo Agreement on Housing Finance Reform

Washington, DC – Today, in reaction to an agreement on housing finance reform released by Senate Banking Committee Chairman Tim Johnson and Ranking Member Mike Crapo, NCRC President and CEO John Taylor made the following statement:

“We are encouraged that the principles for housing finance reform agreed upon by Senate Banking Committee Chairman Tim Johnson and Ranking Member Mike Crapo include facilitating “broad availability of mortgage credit for all eligible borrowers.” The inclusion of a market-based incentive to serve underserved areas in their agreement is promising, and mirrors a proposal put forth by NCRC, but the details will be critical. We look forward to reviewing the forthcoming bill.”

“A continued concern for NCRC is the inclusion of a 5% downpayment requirement for borrowers other than first-time homebuyers, which would negatively impact underserved communities.”

In August of 2013, NCRC released a white paper on GSE reform called “A Guarantee for the Guarantee: Two Proposals to Ensure that the Future Secondary Mortgage Market Serves All Creditworthy Borrowers.” The paper introduced two policy proposals designed to promote access and ensure that the future secondary mortgage market serves all creditworthy borrowers through conventional lending.

The first proposal is called the “Status Quo Access Model,” and applies the existing requirements of GSE affordable housing goals to any future secondary market entity.

Alternatively, the second proposal, the “Incentive Model,” introduces a sliding-cost scale tied to a secondary market entity’s business activities that address unmet housing needs. See the paper here.

About the National Community Reinvestment Coalition (NCRC):

The National Community Reinvestment Coalition is an association of more than 600 community-based organizations that promote access to basic banking services, including credit and savings, to create and sustain affordable housing, job development, and vibrant communities for America’s working families.

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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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