In the mid-1970s, Jimmy Carter was in the White House and Democrats were in control of Congress. Progressives began a campaign to make home ownership a right using race to justify an attack on home loan protocols that experience had established as sound business practice.
Henry Reuss, Democratic chairman of the powerful House Banking Committee, sponsored the Community Reinvestment Act of 1977. Like many government policies, the CRA expanded dramatically once it became law. Future president Obama, then an activist with the "community" organization ACORN, was one of the people who played a leading role in building grassroots pressure to widen the scope of the CRA. Clinton's administration, giving radical interpretations of CRA, forced banks to ensure that large numbers of low-income minorities, who had no ability to repay the loans, could qualify for home mortgages.
A 1992 study by the Federal Reserve Bank of Boston showed that whites and black were denied mortgages at rates of 17 percent and 38 percent, respectively. Progressive journalists in the media called this proof that racism was rampant in the mortgage industry. They didn't check the second study the same year, also by the Boston Fed, which showed that black loan applicants had greater debt burdens, poorer credit histories than whites, and also tended to seek loans covering a higher percentage of the property values in question. After other standard criteria -- income, net worth, age, education and employment the gap between racial groups disappeared.
Attorney General Janet Reno warned that "no bank would be immune from the Justice Department's determination to punish 'alleged' discrimination in lending practices." If a bank failed to meet its quota for loans to low-income minorities, it might fail to earn a "satisfactory" CRA rating from the FDIC and thereby not be able to open a new branch, relocate a home office, acquire, or merge with another bank.