Consumer Watch: Foreclosures on the rise for Latinos


by WHAS11

Posted on June 25, 2012 at 4:40 PM

Updated Monday, Jun 25 at 4:41 PM

(WHAS11) -- US foreclosure filings spiked nine percent in May after a four month decline and Latinos are among the hardest-hit by bank repossessions. In Monday's Consumer Watch, Good Morning Kentuckiana's Andy Treinen takes a look into why.

According to the most recent numbers from the US Bureau of Labor Statistics, unemployment among Hispanics is three percentage points higher than the national average of 8.6 and far too many people know that losing your job often also means losing your home.

In 2006, business was steady and going well. So Ageda Almonte purchased her first home in South Florida.

"I had a good income, I could have it, so I said, 'why not,’" explained Almonte.

Almonte worked independently in family counseling. But in 2007, the financial crisis hit. The single mother of three recalls how clients stopped coming, money became scarce, and she had to shut down her business.

"The moment came when I couldn't make the payments. I started selling my things, my jewelry. They went like water," said Almonte.

Her efforts were in vain.  In 2007, the bank in charge of her mortgage filed for foreclosure.

"I had never been in this kind of situation: to be in debt and unable to pay," reiterated Almonte.

Almonte remembers fantasizing about alternatives she had heard of, like a short sale, a refinancing of her mortgage, or even a forbearance, which would have allowed a temporary deferral of payments.

But her attorney explains that due to his client's lack of income, the bank did not agree to refinancing her mortgage and talks of a possible short sale or other options ended in a lot of paperwork and no conclusion.

"She is a poster child for every part of the real estate calamity that is today's real estate market. She purchased at the height of the boom in ground zero of the real estate collapse here in Miami. She loses her business. She loses her income. She loses her ability to pay her mortgage," claims Sal Collins.

Almonte's case is one among a growing number of homeowners facing this hard situation. 

According to Realty Track, foreclosure filings spiked 9% in May after a four-month decline. Some experts anticipated the jump once banks resolved the so-called "robo signing" issues, a process of automatic approval of foreclosure proceedings without careful revision of each case.

Hispanics in the US have been hit harder than most with foreclosures. According to the Center for American Progress, this group faces a foreclosure rate of nearly 12%, which is significantly higher than the 9% among African Americans and the 5% rate among whites.

Almonte is well aware that she's not alone, but that offers little consolation to this working mother who has been in this process for over five years and now just wants resolution.