Last year's Congress, with considerations of such proposals as the Financial Institutions Act and the FINE study, looked to approval of radical changes in the financial institution structure in this country. These discussions can be expected to continue next year. How can any changes in banking and savings and loan structure, including inter-state branching, be intelligently considered without full knowledge of past lending patterns and national pictures of redlining? "triage", Every few months there is a new theory on solving urban problems "planned shrinkage", "doughnut theory", etc. Most of them call for massive urban removal, not urban revitalization. The theories are not based on a knowledge of where the money is going but rather on a lack of that knowledge. Senators, the time is long overdue that we have that knowledge. We need a national audit. The regulation changes and amendments I have just outlined are absolutely necessary if Congress is serious about really using the disclosure data to end redlining and assure that our neighborhoods and our cities have the necessary credit to remain healthy. In conjunction with that goal Congress must take the next logical step. This country needs legislation that outlaws geographic discrimination in lending. The practice of denying a loan to any individual solely on the basis of the geographic location of the property is the most insidious form of redlining and must be stopped! Such a law should contain strict enforcement provisions and penalties. Thomas Jefferson insisted that "as new discoveries are made, new truths disclosed . . institutions must advance also, and keep pace with the times". We have taken a good first step. Let's keep up the pace. HOME MORTGAGE DISCLOSURE ACT OF 1975 proposed by National Peoples Action The first five changes can be made at the regulatory level by the Federal Reserve Board. These same points were recommended to the FED by NPA last spring when the Board was writing HMDA regs. Their absence from the final regs has limited the scope of the law and restricted analysis of data currently available under the law. 1. Currently the format for filing is not required to be uniform. Institutions should not per se be required to use the actual form, but the format must be uniform, i.e., each colum must be identified in the same order whether entries in each category are made or not. Column "one" must be column "one" whether the individual institution hand-logs entries on FED forms or files by computer print out. 2. Currently FHA, VA and FHA loans are lumped together as a single entry. Separate columns and figure entries must be required. 3. Census tract numbers and ZIP code numbers must be listed in numerical order. 4. All home improvement loans are reported together. Dollar amounts and numbers of loans must be reported under two categories: conventional home improvement loans and federally insured home improvement loans. 5. Multi-family loans should also be reported under two categories: conventional multi-family loans and federally insured multi-family loans. In order that the full housing investment picture is reflected by HDA data, the following categories of housing investment should be included, by Congressional amendment if necessary: 1. Acquisition and Development of Land loans. 2. Development of Building Lots and Sites loans. 3. Construction loans. This information is necessary to determine what institutions are providing the "front monies" for new development. In these advance-commitment-type situations the mortgage money is also frequently provided at favorable terms. This type of marketing is a key factor in the disinvestment process. We need to see the figures and the pattern of this kind of investment. submitted in testimony by Gale Cincotta, Chairperson National Peoples Action November 23, 1976 A national survey by National Peoples Action (NPA) of mortgage lending policies in the United States NATIONAL PEOPLE'S ACTION NATIONAL SURVEY DOCUMENTS REDLINING The Home Mortgage Disclosure Act of 1975 grew from the demand of people across the country. Neighborhood groups began organizing in 1969 to fight the redlining-disinvestment process. These groups expanded into NATIONAL PEOPLE'S ACTION (NPA), a national network of community groups in 39 states and 104 urban centers. Their common bond was their opposition to the practice of redlining by financial institutions. These cities, though miles apart, were all victims of money lenders and their arbitrary decision to stop making the mortgage and home improvement loans which are vital to neighborhood survival. One of the major demands which developed across the country was that financial institutions be required to disclose where their mortgage loans were being made. Community people demanded the right to know where their savings dollars were being lent. A two-year organizing drive, coordinated by NPA, resulted in the passage of the Home Mortgage Disclosure Act of 1975. The Congress finds that some depository institutions have sometimes |