Saturday, June 19, 2010

Predator-Prey Cycle

An exhaustive study of the 2007-2009 foreclosure crisis (still ongoing, frankly) showed that even despite income levels,  African-Americans and Latinos were more likely to be foreclosed upon.
Recent African American and Latino home borrowers — regardless of their income — were much more likely to lose their homes to foreclosure than non-Hispanic whites during the ongoing housing crisis, according to a new study.

In fact, as their incomes climbed, minority borrowers saw their likelihood of foreclosure grow even larger in comparison to non-Hispanic white borrowers in the same income bracket.

That's the conclusion of "Foreclosures by Race and Ethnicity: The Demographics of a Crisis," a new report by the Center for Responsible Lending, which analyzed racial and ethnic data on more than 80 percent of the estimated 2.5 million home foreclosures completed between 2007 and 2009.

The study found non-Hispanic whites accounted for 56 percent of home foreclosures during this two-year period compared to just 16 percent for Hispanics and about 12 percent for African American homeowners.

But nearly 8 percent of blacks and Latinos who got home loans or refinanced between 2005 and 2008 ultimately lost their homes to foreclosure between 2007 and 2009, compared with just 4.5 percent of non-Hispanic whites.

That means that, overall, black and Hispanic homeowners were 76 percent and 71 percent more likely to go into foreclosure than non-Hispanic whites. And blacks and Latinos with the highest incomes were 81 percent and 94 percent more likely to face foreclosure than non-Hispanic whites with similar incomes, the study estimates.

"These disparities hold across all income lines," said Keith Ernst, the center's director of research, who co-authored the report.
That's vital information there and should put the nonsense about the Community Reinvestment Act causing the foreclosure crisis to bed for good.  Sadly, there are those who aren't paying attention to the bolded statements there once again saying this proves that Those Damn People wrecked the economy, but real wingers don't let facts get in the way.

The reality is that the mortgage industry was more than happy to victimize minorities to get money because housing prices were going up, and they only way to get more money was to get more homeowners borrowing.  That meant going to minority borrowers, a lot of them first-time homeowners, and giving them the slimiest deal possible because they could get away with it.

All that greed backfired eventually.  But it's nice to blame minorities when even the ones with high income were getting foreclosed on more than whites.

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