CRA not the cause of Subprime meltdown.

"As Barry Ritholtz notes in this fine rant, the CRA didn't force mortgage companies to offer loans for no money down, or to throw underwriting standards out the window, or to encourage mortgage brokers to aggressively seek out new markets. Nor did the CRA force the credit-rating agencies to slap high-grade ratings on packages of subprime debt."
http://www.slate.com/id/2201641

The CRA, Community Reorganization Act, helped create the less-so but still-profitable subprime lending market to minorities in 1977. It remained stable for nearly 20 years. In 1995, Clinton altered the act to allow for slightly riskier loans – Bear Sterns (note, not covered by CRA regulations anyway) lead the way in using this law change to aggressively enter this market. From 1997 to 2002, the subprime rate rose to and stabilized at about 10% of the overall market. In 2000 Phil Gramm, one of the John McCain’s chief economic advisers wrote the Securities Modernization Act, which introduced Default Credit Swaps – insurance on loans that wasn’t called insurance so that it wouldn’t be regulated, and responsible for trillions of dollars of the current problem. In 2002, Clinton’s changes were up for review, but Bush did not review them. From what I can find, he didn’t act on the review period at all.

In 2003, Bush noted that Fannie and Freddie’s subprime loans were getting to be too large of their overall holdings, and tried to get oversight of the two entities moved from congress to the Treasury Department. This action failed, no doubt because handing over more power to the Executive branch in 2003 was not likely to happen. This action did not do anything about the public mortgage marketplace, just the FM’s.

In 2005 the Bush administration, via the Office of Comptroller of Currency enforced for the first time, a 1860’s law which allows federal oversight of banks to supersede state-level regulation. All 50 state AG’s and all 50 state Banking Commissioners objected to this action, which prevented state-level regulations from being enforced. Also, the CRA was amended to only apply as it had previously to banks with assets >$1B, instead of all banks with assets greater than $250M as it had previously, and allowed mortgage banks to leverage themselves beyond the 10% threshold that had previously been in place (Lehman Bros was at 33/1 when it fell over). At this point, subprime lending increased from ~10% of the mortgage market to ~25% as of the beginning of this year.

More than half of subprime mortgages were made by institutions either not covered by the CRA (independent mortgage brokers) or only partially covered (bank subsidiaries), and 40% of all home purchases in 2006 were not primary residences – a record number.