Community Capacity Building

A community development bank is a sub-division of a consumer bank. There are four main goals of a community development bank.

1) The bank offers home loans to low income individuals/families, at a lower, fixed interest rate, with little to no money down, for a longer loan period of payback time than a tradional home loan.

2) If an individual is interested in a home that is not in a desirable community a lower interest rate is offered with a lower down payment. In hopes of eventually making the community a more desirable place to live.

3) Rural Development, the bank offers the same loan benefits for homes and businesses in a rural area. To help build up the community.

4) Loans for upgrading an existing home or business with the same terms are available, to keep the community within it’s good standing.

Community development departments are offered at all most every bank. They follow government regulations and a majority of the money comes from government grants. Therefore the banks are not risking anything. Even if the money borrowed is not returned all the bank looses is the interest money.

Sources

www.bankofamerica.com

www.frb.org