The statistics are sobering: More than one million homes have fallen into foreclosure since the housing crisis began in 2007, and many of those struggling homeowners are African-Americans.

According to the Mortgage Bankers Association, more homeowners have experienced foreclosures than ever before,

This week, as the housing market continues to plummet, U.S. Housing and Urban Development Secretary Shaun Donovan outlined for African-American reporters the administration’s plans for addressing the mortgage foreclosure crisis. He also warned of scams against homeowners who are threatened with foreclosure. 
“Earlier in this decade, there was a significant increase in African-American home ownership, and that has been part of ... an effort to ensure that African-Americans can be part of the growth in lending and access to home ownership,” Donovan said in a conference call with reporters on Monday. “We also want to make sure that while we rescue people from the edge and from foreclosure that we ensure that credit remains available and give African Americans access to the American dream.”

Donavan acknowledged that African-Americans had been disproportionately burdened with subprime loans and predatory practices and that roughly half of African-Americans who received mortgages in the past decade were given “high cost loans,” which, by definition, were similar to subprime loans.

The problem didn’t just hurt low-income homeowners, Donovan said.

Even in New York’s Jamaica, Queens - identified in the 2000 census as the single county in the entire country where median income for African-Americans was higher than it was for whites - 60 percent of all loans in that community were high cost loans, the secretary said.

Donovan said the administration's recovery plan would help 7 million to 9 million homeowners lower their housing costs.

Under the plan, 4 million to 5 million homeowners who are current on mortgages received through Fannie Mae and Freddie Mac would be allowed to refinance their loans and receive the market’s current lower interest rates.

An additional $75 billion initiative would allow 3 million to 4 million homeowners get loan modifications that would ensure a debt to income ratio of no more than 31 percent.

“We are also making sure that today’s loan interest rates continue for those who want to refinance or buy a home in today’s market,” Donovan said, to help stabilize the market and help people get or stay on their feet.

That will be done in part, he said, by backing up Fannie Mae and Freddie Mac loans with up to $200 billion.

The goal, Donovan said, was to ensure that 95 percent of the new mortgage market could provide stable, long-term lending because, “It’s important to keep credit flowing to low- and middle-income borrowers.”

The administration, he said, also was concerned by what he called a re-apppearance in the marketplace by “unscrupulous” bankers and financial institutions that led many homeowners into financial instability.

“Unfortunately, we’re now seeing some of these folks trying to get back with foreclosure (rescue) scams,” Donovan said. “We’re trying to get out to homeowners in trouble that they have places they can go to get good advice.”

He warned that homeowners should not pay fees to get access to the administration’s rescue plan, saying they could call the HOPE Now hotline at 888-995-HOPE (888-995-4673) or go to the HUD Web site, www.hud.gov, for further information.

“You never have to pay for access to the president’s plan,” Donovan said. “There is no fee to talk to your servicer. If someone is trying to charge you to participate in the president’s plan, they should look elsewhere.”

FHA borrowers, he said, may call 800-225-5342 for assistance.

Donovan said that over the next month, the president’s plan would outline what penalties unscrupulous lenders would face for violating fair .....

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