Mon September 28, 2009
Foreclosures Impact Latino Immigrant Communities
Kansas City, KS – The foreclosure crisis has brought a particular set of issues to Latino immigrants in the Kansas City area. Because of language barriers and the lack of a credit history, many immigrants are vulnerable to predatory lenders. They haven't faced more foreclosures than other groups. But when they do have housing problems, there are a few places where they can turn for help.
Carmen and Luis Amiel came to Kansas City about three years ago to buy a house.
"Because I lived 16 years in California and could never buy a house," Luis Amiel says. "Because it was too expensive."
Luis Amiel is from Peru, originally, and Carmen Amiel is from Mexico, where she had studied architecture. They met in Los Angeles, married and had three children. But then Carmen heard from some relatives about the good housing market in Kansas City.
She says they were excited about possibility of a house, with space for their kids, decent schools, and a quiet neighborhood. Her family recommended a real estate agent.
He sold the Amiels a $60,000 house with many structural problems. He promised to fix them, but never did.
"Because they didn't have the knowledge," says Licha Ybarra, who runs a home ownership program at Harvest America, a non-profit agency based in Kansas City Kansas. "They didn't know what to do. They didn't know how to do it. They didn't know who to go to. They were not able to get anything done, period."
Earlier this year, the Amiels came to Harvest America looking for help, when Luis lost one of his two jobs, and they fell behind in their mortgage payments. In the past year, Licha Ybarra's office has gotten hundreds of calls for help with loan modifications, mainly from Latino immigrant families.
"Someone just found out about Harvest America," Ybarra says. "And then we had all these calls; so we had a high volume of, unfortunately, foreclosure cases."
For Ybarra, it's been a stunning turn of events. About 15 years ago, she helped found one of the first local home-buyer programs geared towards Spanish speakers.
"There was a boom," Ybarra says. "In their countries, you have to be rich to buy a house and when they found out that all they needed was between a three percent and five percent down-payment. It was just word of mouth!"
In the late 1990s, several banks saw this as an under-served market. They began translating mortgage applications into Spanish, and accepted taxpayer IDs for those who didn't have social security numbers.
"I have to tell you that most Latinos are ready," Ybarra says. They have their money saved up, they have their savings, they have great work history, great rent history.
Ybarra says if they don't have traditional credit, she and the banks will work with home-buyers to come up with an alternative. But without that help, immigrants were at the mercy of some unscrupulous lenders.
"So here they were signing all these documents, you know, paying all these high fees, interest rates, paying all this money to the broker, to the real estate agent. And you know what, a lot of Spanish-speaking brokers, and a lot of Spanish-speaking real estate agents sadly took advantage of their own people."
In the past year, Ybarra says she's been able to help most families with bad mortgages get loan modifications.
Now this doesn't mean that Latino immigrants have had more problems with foreclosures than others. Ann Murguia heads the Argentine Neighborhood Development Association. She's been tracking foreclosures throughout Wyandotte County, where she's also a Unified Government Commissioner.
"Based on my experience in Argentine," Murguia says, "The number of foreclosures with migrants is few and far between."
Murguia's observations coincide with a national report from the Pew Hispanic Center, which says the rate of homeownership among immigrant Latinos has stayed the same in the past couple of years. That's even while homeownership has dropped for US-born Latinos, African Americans and whites.
"Migrants typically don't over-extend themselves," Murguia says. "It's a very conservative population, and they try to live within their means."
Murguia says even in situations where families have been the victims of predatory schemes, many will just keep paying a large portion of their incomes on loans they'll probably never pay off. And that's for modest homes.
"People want to keep paying because they don't want to raise any attention to themselves. And I don't just say that because they're undocumented. They don't want to cause problems, they don't want to make waves, and so - they don't complain."
Back at Harvest America, Licha Ybarra says some of these same predatory lenders are now charging families to do loan modifications.
Ybarra tells the Amiels, "Don't trust someone just because they speak your language."
And as for them, Luis Amiel hasn't been able to find enough work here. So he's thinking about going back to California, while Carmen and the kids stay in Kansas City.
"How sad," Licha Ybarra says, "That they'll need to be separated just to keep paying for their home."