Question & Answer

Question: Does an investment count for CRA purposes if the purpose is to develop affordable housing for median income residents?

Answer:The answer depends on the cost of housing in the market. The key is whether the housing is affordable. In a high-cost area, such as New York City or San Francisco, there may be serious affordable housing needs for middle income borrowers. Housing for low- or moderate-income residents may be a need that can only be met in a different way. The important things to consider would be the housing market itself and the need for housing relative to income levels.

Copyright © 1999 Compliance Action. Originally appeared in Compliance Action, Vol. 4, No. 10, 8/99