So what the same happens to whites as well. When you can’t afford your mortgage you lose your house. Simple as that. They shouldn’t be rescued simply because they are minorities.
I think the reason many minority families get into trouble mortgage wise is that they often buy more house than they can afford.And there is a psychology going on here.
For many blacks-and Hispanics-who grew up in low income areas,the American Dream has always been to have a big house in the suburbs.For black women in particular,this is an obsession.And one can sympathize.After all,they don’t want their kids going to the horrible schools in the hood and have to deal with the gunfire and rip offs that happen so frequently.
So in order to purchase this dream house,many minority families pull out all stops and manage to get the mortgage.Yet they find that living the suburban lifestyle means spending all kinds of money on other things in order to keep up with the proverbial Joneses.Debt then piles up and finally many of these families do lose their house and their dream and they are back renting in the hood again.
Not saying this justifies their wrong headed thinking,just trying to explain it.
My last reading said that 13% of the subprime (lowest credit scores) are being foreclosed. Now that also means 87% are still doing okay or are up-to-date anyway. Projections are that more will foreclose as adjusted loans have to be recast.
Subprime loans was a method to get more folks into home purchases. Worst combination was the subprime and 100% loan.
The 100% loan did not entirely disappear if you were over 720 and could go full doc. Now it's back down to 700. We'll see where this goes.