How does the Community Reinvestment Act Force banks to make High-Risk Loans?

im pretty sure you answered you're own question.. it hadn't "forced" banks..

if the banks had wanted to qualify for the federal deposit insurance (which isn't a requirement rather than major benefit) the banks had to meet these new standards

there weren't any penalties.. it wasn't like a forced mandate on mortgage lending..

the only argument i could think of is.... if the banks hadn't complied with the CRA standards (which hadn't even been explicitly detailed on how) then the government COULD take that into account when the banks had wanted to expand or merge their business

but either way.. it hadn't forced banks to make high-risk loans

It doesn't. That was just the easiest Democrat led initiative to blame the housing crash on. CRA or any other law also didn't force banks to push 80/20 mortgages, risky ARMs with ridiculous teaser rates, or any of the other tactics that filled their balance sheets with toxic assets. But, if people were to correctly blame banks for the mess, it would justify reasonable regulation which is frowned upon by some even if it makes perfect sense for all involved.

No one got their bad loan at the point of a gun or with a lawyer waving the CRA act in front of an underwriter. Everyone of those bad loans was made or enabled by the realtors, appraisers, inspectors, underwriters, loan officers, and closing agents who were in fee heaven gorging themselves on every transaction - good, bad or outrageous, instead of doing their jobs properly.

Absolutely no. Never did. This is one of the most egregious of all right wing lies. Bill Clinton specifically stated that the purpose was to allow QUALIFIED borrowers to get home loans. It was the banks and the financial industry that figured out how to make billions by making bad loans and then selling them as good loans by packaging them. As we have seen the right wing will lie about anything and this is one of their most consistent lies.

In 1995, the regulators created new rules that sought to establish objective criteria for determining whether a bank was meeting CRA standards. Examiners no longer had the discretion they once had. For banks, simply proving that they were looking for qualified buyers wasn’t enough. Banks now had to show that they had actually made a requisite number of loans to low- and moderate-income (LMI) borrowers. The new regulations also required the use of “innovative or flexible” lending practices to address credit needs of LMI borrowers and neighborhoods. Thus, a law that was originally intended to encourage banks to use safe and sound practices in lending now required them to be “innovative” and “flexible.” In other words, it called for the relaxation of lending standards, and it was the bank regulators who were expected to enforce these relaxed standards.

The effort to reduce mortgage lending standards was led by the Department of Housing and Urban Development through the 1994 National Homeownership Strategy, published at the request of President Clinton. Among other things, it called for “financing strategies, fueled by the creativity and resources of the private and public sectors, to help homeowners that lack cash to buy a home or to make the payments.” Once the standards were relaxed for low-income borrowers, it would seem impossible to deny these benefits to the prime market. Indeed, bank regulators, who were in charge of enforcing CRA standards, could hardly disapprove of similar loans made to better-qualified borrowers.

The banks had to meet a quota in order to still have rights to merge and to sell the mortgages to Frannie and Freddie. They had to sell sub prime mortgages to recoup their capital to make more loans.

Freddie and Fannie are now in trouble for misreporting how many sub prime mortgages were in the system as the banks kept refinancing the defaulted loans. When homes became artifically priced out of the market, the whole thing collapsed. Too few were buying anymore. Too few were paying their mortgages.

It did not and does not.
The cause of the problem was criminals in the banking industry defrauding innocent home buyers. And all of the lies conservatives can dream up won't change that -- or make those conservatives any less the lying, immoral scum they are -- not to mention their contempt for the law as demonstrated by their attempts to excuse criminals.

It doesn't and it didn't. Conservative lies will try to convince you otherwise but the actual facts are not in dispute.

Never did, never will .