For Francisco Zapien, the deal was too good to be true.

In October of 2006, Zapien signed a contract for a home on Bryan Avenue in Napa. The $550,000 mortgage he was approved for required no down payment.

Today Zapien, who has worked at Silverado Farming Company as a tractor driver and machinist for the past four years, is caught in a vise. His monthly mortgage is more than he can pay. His home has lost value.

“I have put my home on the market,” said Zapien. “It’s too much money to pay each month.”

Zapien knew his monthly costs would be high, so he rented two rooms in his home. The rooms yielded an extra $1,000 a month to help pay the $3,600 monthly mortgage. But with utility bills and other expenses, Zapien said he still was scrambling to pay $2,900 a month.

“If the home doesn’t sell, I will have to turn it in to the bank,” he said.

Zapien is one of thousands of homeowners across the country facing this dilemma.

Real estate experts say the mortgage mess has hit the Hispanic community especially hard, in part because Latinos represented such a large chunk of the class of first-time buyers who — it seemed — finally had a chance to borrow money and chase the dream of homeownership.

In many cases, people simply bit off more than they could chew.

In some cases, mortgage brokers helped bring people into the market who they knew or should have known would struggle, according to real estate professionals.

Not fully understanding the terms of a loan put many first-time home buyers in a bind, said Heidi Rickerd-Rizzo, executive branch manager at the St. Helena office of Pacific Union Real Estate.

“There’s the layer (to the overall foreclosure problem) where there really are victims and there was greed involved in the underwriting process ... giving people products that they didn’t understand, with first-time buyers relying and trusting on professionals  giving them advice.”

Lack of understanding

Zapien’s story sounds familiar to Gerardo Hurtado, of Suisun, and Evodio Perez, of Napa, who both work alongside Zapien. They said they signed mortgages that they didn’t fully understand.

Hurtado said he is happy to have sold his Suisun home and be released from a mortgage that was too much for him to meet.

Perez is playing a waiting game; in January 2009, he will find out if he has to sell his house or keep it. After refinancing a condo he owned in Napa and making a $60,000 down payment, Perez moved into his El Capitan Way home in 2006.

After a few months of barely making the $1,800 mortgage, Perez realized that his adjustable-rate loan was too much. He considered refinancing, but the terms of his loan required him to make regular mortgage payments for three years before refinancing or selling the property. Otherwise, he’d face hefty penalties.

In January, Perez said he will find out how much his house is worth. If it’s gone down in value, he will have to sell — if not, he will look to refinance. “I feel frustrated,” he said. “I bought my home with the intent to progress.”

Hurtado was in the same situation as Perez. If he refinanced early, he would face penalties.

Feeling trapped in a loan that he couldn’t afford, Hurtado put his home on short sale and accepted an offer for $360,000. That is about $70,000 less than what he was asking, he said.

Hurtado said he thought that he was entering into a loan that would allow him to re-finance within a year; he was surprised to find out that it was actually three years.

“They never explained that to me,” he said.

The housing crunch is causing a ripple effect, Rickerd-Rizzo said; people are moving out of neighborhoods and sometimes leaving possessions behind.

Margarita Fernandez, a real estate agent for Marin 1 Real Estate, specializes in helping Latino clients, but observed that the problem is more widespread.

“There are houses that are devalued,” she said. Homeowners who signed onto adjustable and other creative mortgages are finding “Their interest (rate) is going up, so now they are faced with high payments. The majority of my clients are Latinos ... (but) other people are facing the same thing.”

Fernandez said she goes out of her way to make sure that her clients fully understand the terms of their loans.

Laura Sanchez, a Realtor at Heritage Sotheby’s International Realty, also breaks the language barrier and helps her clients understand what they are getting into. But she said that the underwriting process can be complex.

“When you sign all those documents, most of them are in English and there are so many rules,” Sanchez said. “When you sign, you need to be very careful.”

Sanchez pointed out that if home buyers aren’t comfortable with the paperwork, they have a 24-hour grace period in which the lender can help them understand or negotiate the terms of the loan.

Sanchez and Fernandez say that homeowners struggling to make payments should call their loan officers and try to negotiate for more favorable terms.

“Contact their banks or whoever they have their loans with and see if they can work out some kind of deal,” she said.

Zapien said he hopes to sell his home and make a profit. He said he will eventually move into an apartment in Napa so he can remain close to his job. Perez said he will find a way to make the payments until 2009, and hopes then to refinance or modify his loan in some way.

As for Hurtado, he said he plans to move in with his son in Suisun and maybe one day buy a home again.

“To part with the home is to part with stress,” Hurtado said.

Marin 1’s Fernandez said that banks often do not want to seize homes and would rather have the homeowners stay in them.

“There are different circumstances, but I just admire those people who don’t give up and continue (to keep their homes),” Sanchez said. “There are good opportunities in the market and you can take great advantage of it. What’s going on right now ... it’s not going to be forever.”

A free seminar is planned for Sunday, April 13, to help people handle the risk of foreclosure. The seminar, presented in both English and Spanish, is scheduled to start at 1:30 p.m. at St. John’s Hall, 924 Napa St., Napa.

The seminar will give homeowners the opportunity to receive one-on-one counseling sessions with mortgage specialists who can help avoid foreclosure.

“What we are hoping to do is provide people with resources,” said Mora Cronin, spokeswoman for the Napa Foreclosures Prevention Forum. “In many cases, I guess what happens is people will walk away if they get a default notice ... without asking for help. For many people, they can get help. They can re-negotiate a mortgage.”

The foreclosure forum is free. To register, call 253 4219.

Foreclosure Seminar

The Napa Foreclosures Prevention Forum is holding a free seminar in Spanish and English to help people handle the risk of foreclosure. Professionals will be on hand to offer one-on-one counseling sessions with homeowners.

The event is on Sunday, April 13, from 1:30 to 5 p.m. at St. John’s Hall, 924 Napa St., Napa. To register or for info, call 253-4219 or e-mail ForeclosureForum@co.napa.ca.us.