What is the primary objective of the Community Reinvestment Act (CRA)?

• A. To reduce discriminatory lending
• B. To regulate mortgage interest rates
• C. To measure borrower creditworthiness
• D. To encourage banks to meet the credit needs of the surrounding communities, including low- and moderate-income neighborhoods

Answer: (D)

The main idea being tested is what the CRA is designed to accomplish. The Act aims to push banks to serve the credit needs of the communities where they operate, including low- and moderate-income neighborhoods. This means encouraging lending, investments, and banking services in those areas so that people have access to credit and financial resources, which helps prevent redlining and promotes fair access to banking.

So the correct choice best reflects that purpose: fostering banks’ active participation in meeting community credit needs. The other options describe related ideas—like setting mortgage rates or judging borrower creditworthiness—which are handled by different parts of the financial system and aren’t the primary objective of the CRA.