Groups demand foreclosure moratorium http://www.chron.com/disp/story.mpl/business/4689460.html NEW YORK — Civil rights groups called Wednesday for a six-month moratorium on foreclosures resulting from high-risk loans given to people with shaky credit, arguing that lenders should help borrowers refinance their mortgages or face lawsuits. A coalition of advocacy groups said mortgage lenders should immediately halt foreclosures on so-called subprime mortgage loans made at high-interest rates to people with weak credit histories. The groups, at a news conference in Washington, D.C., said a predicted wave of foreclosures stems from "reckless and unaffordable loans" for which investors bear some responsibility. They also said lenders, real estate agents and investors who bought subprime loans could face lawsuits under a federal law prohibiting housing discrimination. Lenders, they said, should help homeowners affected by the problems in the high-risk mortgage market by allowing them to refinance their mortgages. "We know that there are safe and affordable loans that meet the needs of our communities," said Janet Murguia, president of the National Council of La Raza, the nation's largest Hispanic civil rights group. "We are calling on them to match families to the sustainable loans that they should have gotten in the first place. … There are homes of families that can be salvaged." John Robbins, chairman of the Mortgage Bankers Association, said many lenders are setting up payment plans to help avoid foreclosures among borrowers, many of whom have a hard time qualifying for refinancing. James Ballentine, director of housing and economic development at the American Bankers Association, said the call for a moratorium is an "overreaction" to problems in the mortgage market. He said there are many reasons borrowers default — including medical bills and the loss of jobs — that don't necessarily mean a lender took advantage of them. The advocacy groups said high-interest-rate subprime loans harm black and Hispanic home buyers the most, citing data from 2005 showing that subprime loans represented more than 50 percent of all mortgages taken out by black borrowers and 40 percent of Latino borrowers, compared with 19 percent of white borrowers.
