One of the major issues in this debate is the disconnect in how things like CRA are perceived, and how they are implemented.

If you check the CRA what you will discover is that it is intended to increase lending in 'disadvantaged communities'. That's right, the loans are based on neighborhood, not individual disadvantages. For instance, an impoverished person from inner city Chicago finds a great deal on a house in Evanston, a suburb. CRA does NOT cover this situation, as you imply, because Evanston is not a 'disadvantaged community'. Same guy wants to buy a house in inner city Chicago and CRA DOES cover his situation.

That's where the fun starts!

It's at that point that people like me were helping large development firms come in and buy up property in the 'disadvantaged communities'. You keep just enough poor people to keep the disadvantaged designation and you build condos that sell like hot cakes. Usually you set aside a few units in every building for 'disadvantaged' people to buy. But here's the beauty of it. Most municipalities classify 'economically disadvantaged' as 'at or below the median income' for that municipality.

By way of example, in Madison, WI, at the time, I believe it was $50000 per year that made you 'economically disadvantaged'. Make below $50000 per year, and you would qualify for one of the set aside units. The developer still made a killing, the cities looked like they were helping regular folks, and crime in the downtown areas dropped dramatically.

Of course, now we see the mortgage crisis and the unintended consequences, but it all seemed like a good idea at the time. And parts of it were a good idea.

Now, I don't know who explained CRA to you. But I can tell you unequivocally that for developers tools like this were VITAL. TIF as well. Downtown redevelopment rarely works without them.

IF it is the case that politicians wanted to help these people, then they should have written the law so that it centered on the people and not the neighborhoods. My own opinion is that the real estate development industry probably lobbied hard to have CRA center on the idea of disadvantaged neighborhood. Because the whole thing was just too easy to not have been planned.

In summary, take my word for it, I am VERY well versed with urban real estate development. CRA was not, indeed cannot, be used in the fashion you intimate. If someone told you that CRA obliged a bank to loan to people who could not afford it, then I'm afraid you've been misinformed. CRA obliges banks to lend in NEIGHBORHOODS that are disadvantaged.

It is not by accident that many luxury condo developments are in formerly sketch areas. Nor is it a happenstance that the 'downtown condo' rose to prominence with the expansion of CRA. Go to any major city in the US and find a long time resident to walk around downtown with you. The story s/he will tell you will go something like this:

"Boy, I can remember when this was a really dangerous area. But they really have fixed it up haven't they! When my kid goes off to college, we're thinking of moving down here!"

And finally, as always, don't take my word for it. That was your mistake before, when you took the word of someone else that CRA obliged banks to lend to people who could not afford it. What I would encourage you to do is read through the act your self. Start here, http://www.ffiec.gov/cra/. You will see that 'communities' and 'neighborhoods' are the units of interest.

Always get the data on your own kid. There are a lot of people out there trying to manipulate right now. Left wing socialists, right wing corporatists. Trust no one! Go read it for yourself.