The Latinos of Central Florida were the worst affected by the foreclosure crisis

Posted on July 30, 2009
Filed Under Foreclosure Homes | 1 Comment

The Latinos of Central Florida were the worst affected by the foreclosure crisis because it was they who were made to take the maximum number of sub-prime mortgages. The fast growing minority group is now drowning in foreclosures.

According to government records the Hispanics were peddled the worst kind of risky loans. Two years ago they were sold one fourth of all the home mortgages. When the housing bubble began to burst it was found they had one third of the area’s sub-prime mortgages. Over 40% had the worst of the sub-prime loans.
The local legal personnel complain that they are now bombarded with cases of Latinos who are now defaulters. A lawyer in Orlando is handling a case that makes the allegation that the buyers who spoke Spanish were “targeted by predatory lenders.”

Jose Hoyos, a mortgage lender and one of the key witness in the foreclosure related cases quipped, “It was cultural greed. … They were overselling the American dream. You’re Hispanic — you deserve the best. You deserve that house in Windermere. You are a janitor? Oh, no, no, no — you own a janitorial business. No, you don’t have to put any money down.”

As per the findings of Pew Hispanic Center, the Latinos across the country were doubly more likely than the non-Hispanic whites to be given the risky loans when they planned to either buy or refinance their residential houses during the time of the boom and also after that.

There are many explanations forwarded for the Hispanics thus being victimized. Some say that during the last decade there was a wave of Latino migrants rushing into Central Florida. During this time house sales had picked up at record speed and the lenders were forcefully peddling risky sub-prime loans. A second opinion is that the poor knowledge of English made the Hispanics more liable to be manipulated in comparison to other purchasers. Another reason was that the Latinos tended to put too much trust on lenders from their own community. It is these Latino lenders who took a leading role in duping borrowers from their own group. Many borrowers like anybody else took wrong decisions.

Rep Darren Soto said, “I certainly think there was a lot of Hispanic-on-Hispanic fraud going on. A lot of them were preying on borrowers based on trust built through shared language and on common religious beliefs. … They believed that a man of God wouldn’t take advantage of them.” The law firm of Soto in Orlando is representing over 100 borrowers embroiled in foreclosure matters.

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