ADDISON, Illinois (Reuters) - In a month or two, Jose Cortez will likely lose the home he wanted for his children. But he says that's not what bothers him most.
"I wanted to consolidate my debts, but everything the brokers said they would do was a lie," he said, waving a sheaf of documents in the basement apartment where he, his wife and four children live.
Many minorities in Chicago are facing the same predicament as the 57-year-old Mexican-born maintenance worker, according to several nonprofit organizations. Some unscrupulous and unregulated mortgage brokers arranged for low-income families to take out loans they could not afford, the groups said.
The nonprofit Woodstock Institute released a study this month that said Latino borrowers in Chicago were 3.2 times more likely than whites to pay more for loans; African Americans were 4.2 times more likely.
"The main feeding ground for predatory subprime mortgage brokers is in poor, minority communities," said Michael van Zalingen, director of housing ownership services at Neighborhood Housing Services of Chicago, a nonprofit community lender and financial counseling service.
Subprime, or high-risk, borrowers like Cortez are causing concern on Wall Street and in Washington as foreclosures rise amid falling house prices and higher interest rates.
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