The number of active trial and permanent Home Affordable Modification Program (HAMP) modifications in the Chicago region is now at its lowest since regional data has been reported, new data show (see our previous analyses). There were 34,576 active modifications in the Chicago region in July 2010, compared to 36,208 in November 2009, the first month Treasury released data by metro area.

As bank regulators take a close look at modernizing the provisions of the Community Reinvestment Act (CRA) through a series of hearings and public comment period (you have until August 31 to submit comments), we’re walking you through some key reasons why CRA must be updated. We’ve gone over how assessment areas don’t fully capture where a bank does business and why a broader scope of financial institutions must be covered by CRA. Today we’ll explain how CRA doesn’t meaningfully measure how banks are providing retail banking services to low- and moderate-income people.

Are you:

• A financial institution trying to understand the financial needs of a certain market?
• A government agency trying to decide where best to allocate scarce resources?
• A nonprofit organization looking to better serve your clients?
• An organization in need of rigorous research, program evaluation, or data and policy analysis that connects broad financial policies to community realities?

The predatory subprime lending crisis devastated families and communities across Chicago and the nation, particularly low-wealth communities and communities of color.

A crucial tool to fight discriminatory and predatory lending is the Home Mortgage Disclosure Act (HMDA). HMDA requires mortgage lenders to provide detailed reports of their lending to regulators and the public. Woodstock Institute uses HMDA data to track discriminatory lending practices, study patterns of community investment, and hold individual banks accountable for their lending practices.

Community leaders turned out in force at the Community Reinvestment Act hearing held at the Federal Reserve Bank of Chicago on August 12 (see photos). The Chicago hearing was the third of four such hearings being held by federal banking regulators this summer to discuss whether and how to revise rules implementing the CRA’s requirement that federally insured depository banks meet the credit and financial services needs of the communities in which they operate, including low- and moderate-income communities, consistent with safe and sound practices. The CRA became law in 1977 and current CRA rules have not been updated since 1995.

As bank regulators take a close look at modernizing the Community Reinvestment Act (CRA) through a series of hearings and public comment period, we’re walking you through some key reasons why CRA must be updated. Last week, we explained how assessment areas don’t fully capture where a bank does business (see the discussion at Huffington Post). Today we’ll explain how CRA applies only to a fraction of the financial industry and why communities need a broader CRA to ensure that all financial institutions are offering safe and sustainable products where they do business.

You can still make your voice heard on the need to improve the Community Reinvestment Act, even if you were not able to attend last week's hearing on CRA modernization at the Federal Reserve Bank of Chicago.

A federal judge ruled that Wells Fargo engaged in deceptive practices in its overdraft loan program and ordered that the bank pay more than $200 million in restitution to customers. Wells Fargo manipulated the order in which it processed transactions in order to maximize the number of overdraft fees charged, processing the largest transactions first. This zeroes out a customer’s balance faster and charges overdraft fees for each smaller transaction that goes into the negative.

Tax preparers who arrange refund anticipation loans (RALs)—high-cost loans secured by a taxpayer’s expected income tax refund—have long relied on the IRS to provide information on any outstanding debts, such as back taxes or child support, that will be withheld from the borrower’s tax refund. This information, called the “debt indicator,” allows tax preparers to underwrite RALs and facilitates an industry that strips $114 million from Illinois taxpayers. In a huge victory for consumers, the IRS announced that it would stop providing the debt indicator to tax preparers.