A decision by Congress last week to eliminate funding for free HUD-approved housing counseling will hurt homeowners struggling to avoid foreclosure, including many Latinos, according to national and local experts.

"Forty eight percent of foreclosures in California involve Latinos," said Janis Bowdler, a Latino homeownership expert at the National Council of La Raza. "The impact in terms of foreclosures on Latinos is going to be severe."

Bowdler was citing a figure from a study released last year by the Center for Responsible Lending, a nonprofit research and policy organization, that examined the foreclosure crisis in California.

In San Diego County, the cut will mean a reduction in counseling services, approved by the federal Housing and Urban Development department, to thousands of residents.

"It's already happening," said Gregorio Estrella, program manager at the Housing Opportunities Collaborative in San Diego.

"Several housing counseling agencies at the end of 2010 had already decided to cut staff. We knew internally this was in the works," he said.

Estrella's agency does not receive HUD funding but organizes clinics throughout the county where HUD-approved housing counselors from various agencies provide services. He said agencies that are highly dependent on HUD funding would be affected the most.

Since 2007, the collaborative has held 77 clinics across the county that were attended by 9,289 people, including 4,498 who were individually counseled. About 44 percent of those who received one-on-one counseling were Latino, Estrella said. Many were primarily Spanish-speakers; they received counseling in their native language.

Congress, last week as part of a budget deficit reduction plan, cut $88 million in funding from the HUD Housing Counseling Program.

In addition to foreclosure prevention, the program offered free housing counseling to people before they buy, refinance, get a reverse mortgage or start renting.

Congress did

agree to continue a separate foreclosure prevention-only program, which it funded with $65 million. Republicans contended that two programs providing foreclosure prevention counseling were redundant.

Bowdler said the foreclosure-prevention program that remains, known as the National Foreclosure Mitigation Counseling program, is not part of HUD.

According to the Center for Responsible Lending report, Latinos accounted for about one-fifth of the state's homeowners but made up about half of the 600,000 foreclosure filings from 2006 to 2009 that the research group analyzed.

Latinos and African-Americans were more likely than other groups to have received high-risk loans, according to the report.

Latino advocates worry also that a reduction in HUD-approved housing counselors will allow scam artists to step in and take advantage of nervous homeowners.

Bowdler said the housing counseling cuts will go into effect in the fall and that the National Council of La Raza, the nation's leading Latino civil rights organization, is urging its affiliates to "try to fundraise to fill the gap."

Leonel.sanchez@sandiegored.com