Business & Economy

Group accuses banks of violating fed lending rules

A national housing and consumer rights group has filed complaints alleging banks are unjustly denying government-backed loans to borrowers with low credit scores.

The National Community Reinvestment Coalition announced Thursday they filed the complaints to the Department of Housing and Urban Development.

The coalition alleges that 22 banks nationwide violated fair housing laws by failing to issue Federal Housing Administration-insured loans to borrowers with credit scores above a government threshold.

The group claims that the banks' policies harm black and Hispanic communities. The coalition notes that scores of people in predominantly minority zip codes fall disproportionately between the federal threshold of 580 and the higher benchmarks set by the banks.

Copyright 2010 The Associated Press.