In U.S. counties where Hispanics account for more than 25% of thepopulation, banks have taken back 6.7 homes per 1,000 residents sinceJan. 1, 2006, compared with 4.6 per 1,000 residents in all counties,according to a Journal analysis of U.S. Census and RealtyTrac data.
California Rep. Joe Baca has long pushed legislation he said would”open the doors to the American Dream” for first-time home buyers inhis largely Hispanic district. For many of them, those doors haveslammed shut, quickly and painfully.
Mortgage lenders flooded Mr. Baca’s San Bernardino, Calif., districtwith loans that often didn’t require down payments, solid creditratings or documentation of employment. Now, many of the Hispanics whobecame homeowners find themselves mired in the national housing mess.Nearly 9,200 families in his district have lost their homes toforeclosure.
For years, immigrants to the U.S. have viewed buying a home as theultimate benchmark of success. Between 2000 and 2007, as the Hispanicpopulation increased, Hispanic homeownership grew even faster,increasing by 47%, to 6.1 million from 4.1 million, according to theU.S. Census Bureau. Over that same period, homeownership nationallygrew by 8%. In 2005 alone, mortgages to Hispanics jumped by 29%, withexpensive nonprime mortgages soaring 169%, according to the FederalFinancial Institutions Examination Council.
An examination of that borrowing spree by The Wall Street Journalreveals that it wasn’t simply the mortgage market at work. It wasfueled by a campaign by low-income housing groups, Hispanic lawmakers,a congressional Hispanic housing initiative, mortgage lenders andbrokers, who all were pushing to increase homeownership among Latinos.
The network included Mr. Baca, chairman of the CongressionalHispanic Caucus, whose district is 58% Hispanic and ranks No. 5 amongall congressional districts in percentage of home loans not tailoredfor prime borrowers.