Community Reinvestment
CRA Committee: ESOP continues to work in partnership with Third Federal Savings & Loan and Charter One Bank. In late March, 2005, the National Training & Information Center (NTIC) prepared an analysis of Home Mortgage Disclosure Act (HMDA) data for the top twenty lenders in 2002 and 2003. In 2003, both lenders were among the top three lenders in low-moderate income census tracts throughout Greater Cleveland, with the number one position occupied by Argent Mortgage who specializes in sub-prime lending that is often predatory. More importantly, both Third Federal and Charter One had the LARGEST increase in the number of loans made in low-moderate income census tracts; even while lenders like National City Bank and KeyBank actually saw a decrease in their lending in those same census tracts. ESOP's CRA Committee and NTIC are negotiating a CRA agreement with JP Morgan Chase, which recently acquired Bank One. Bank One has the highest rate of foreclosed loans in Cleveland among any other depository institution. Stay tuned for updates on this work.
History
In the late 1960's, many major banks decided to abandon low-income and mostly black communities throughout the nation. In 1977, ESOP's national affiliate, the National Training & Information Center (NTIC) led a fight that resulted in the passage of the Community Reinvestment Act (CRA), which requires banks to make loans in any area where they accept deposits and prohibits them from redlining certain neighborhoods.
