Black Homeowners Less Likely To Get Loan Modifications: Survey

Does being African American reduce your chances of getting help from anti-foreclosure programs? It does indeed, according to a survey that found racial discrimination in loan modification initiatives.

The study is called the NCRC Home Affordable Modification Program Survey 2010. Among its many startling findings:

-Black homeowners behind on their mortgages are routinely foreclosed upon more quickly than delinquent White or Hispanic borrowers.

-White HAMP‐eligible borrowers are nearly 50% more likely to receive loan modifications than African American
HAMP‐eligible borrowers.

-The vast majority of foreclosures are tied to employment‐related problems, with 76.5% of all delinquent borrowers citing job loss or reduced hours as reasons for falling behind of their mortgages. Unemployment is affecting the black community at twice the rate of whites, making the impact on blacks with mortgages more profound.

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Refinancing, Not as Easy as it Used to Be

Your Refinancing Checklist
Interest rates for 30-year mortgages haven't been this low since the Eisenhower administration. But in this current economic crisis, refinancing isn't the easy choice it once was. If you're interested in refinancing, here's what you'll need:

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Refinancing, Not as Easy as it Used to Be

Excellent Credit
To get the best rates, you'll need a score of 720 or higher. So to figure out whether refinancing is a good deal for you, your first stop is finding out your credit score.

Refinancing, Not as Easy as it Used to Be

Home Equity
The next step is determining how much equity you have in your house already in your existing mortgage. Ideally, you should have at least 20% equity, and that must be on your home's existing appraised value. So if your home has lost value in the bad economy, you might want to reconsider.

Refinancing, Not as Easy as it Used to Be

Unencumbered First Mortgage
Before you refinance, you need to clear out any outstanding home equity loans or lines of credit or any second mortgage. Previously, these things would not have held up a refinancing, but today it could cause a lender to say no.

Refinancing, Not as Easy as it Used to Be

Conforming Loan
A "conforming loan" is one that is under $417,000, which makes it available for purchase on the secondary market. If you live in a high-cost area where mortgages run higher than that, you may not qualify for the lowest rates for your refinance.

Refinancing, Not as Easy as it Used to Be

Have Patience
Layoffs have left banks understaffed and the financial crisis is keeping other financial types busy, so you may not get the fast service you desire. If you want to refinance, you may have to wait your turn.

Refinancing, Not as Easy as it Used to Be

All this data is very troubling and should be thoroughly examined by federal authorities to stamp out unfair racial disparities and whatever biases may exist that prevent African American homeowners from getting appropriate help.

I suspect, though, that these numbers don't tell the whole story, particularly since unemployment rates are higher for African Americans than for the general public. That means the foreclosure crisis could be even more acute than the data show, particular for black borrowers. It also means that if the federal government and lenders are serious about trying to help end the foreclosure problem, more help should be directed at African American homeowners -- not less.

Already, one in three black homeowners is currently facing foreclosure, according to the National Association of Real Estate Brokers, or NAREB, an organization of Black real estate professionals.

It's high time we got creative, committed and caring about putting an end to the plight of so many people losing their homes in America. It's not just an economic question, it's about doing what's best for our families, communities, and the entire country.

Are you or someone you know facing foreclosure? What's your experience been like trying to get help? Did you get real solutions -- or simply stonewalled?

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Lynnette Khalfani-Cox, an award-winning financial news journalist and former Wall Street Journal reporter for CNBC, has also been featured in top newspapers including the Washington Post, USA Today, and the New York Times, as well as magazines ranging from Essence and Redbook to Black Enterprise and Smart Money. Check out her New York Times bestseller, 'Zero Debt: The Ultimate Guide to Financial Freedom.'