With interest rates falling and the nation’s housing boom in full swing, growing numbers of fellow Latinos bought into the historically African-American district. Many took advantage of new adjustable-rate loans that got them in with no money down and low initial payments. But two years ago, interest rates reversed course, sales slowed, and developers began discounting the homes they’d built nearby. Buyers with adjustable-rate loans saw their monthly payments rise. Some fell behind and were forced to sell or face foreclosure. The story is similar in many not-quite-up-and-coming neighborhoods around the country.

Mortgage delinquency rates have steadily climbed since 2005, exacerbated by a growing array of exotic loans and loose lending practices. That’s especially true in the subprime market, where many first-time buyers squeaked in with no downpayment. That gave them little reason to stick it out when they fell behind.

“Foreclosures spiked last year, and now we’re hitting a very high rate,” says Celia Chen, housing economist at Moody’s Economy.com, which expects the rate of foreclosures to increase by nearly 20 percent this year to more than 1 in about 200 homes. And if things get worse, “the [rise in] foreclosures is going to put some downward pressure on prices, which is problematic in some neighborhoods.”

Looking for a home in Delaire Country Club? Realtor® Caesar Parisi is ready to help you buy your dream property.

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