PEEL away the concerns about our international creditors, stability on Wall Street and the more than two dozen large loan companies that have closed in the wake of the subprime lending crisis. Ignore the reassurance that the market appears to have stabilized. Beneath those concerns lies the vulnerable homeowner holding a subprime loan.

By year's end an estimated 3 million of them will lose their homes. Disproportionately, they will be black and Latino, an unfortunate effect of the marketing practices of subprime brokers and lenders.

Home Mortgage Disclosure Act data from 2005 reveal that more than 50 percent of black and 46 percent of Latino home buyers received subprime loans, compared to 17 percent of white borrowers. Many of the minority borrowers could have qualified for more favorable terms.

Though the softening of the home market and the rise in interest rates have affected all homeowners to some degree, they have a profound impact on those who hold subprime loans. These high-risk loans go to borrowers with marginal credit, many of whom have already refinanced to the point they have no equity. About 80 percent of subprime loans are adjustable rate mortgages, so those who were barely hanging on in the initial low-interest years of their loan often find themselves unable to meet payments at the higher interest rate.

Those who argued that the subprime products offer homeownership for many who would not otherwise qualify are partially correct. But homeownership for black Americans has slipped from a high of 50 percent in 2004 to 47.9 percent in 2006, primarily due to the increase in foreclosures.

The Center for Responsible Lending estimates that one in five subprime loans made in the past two years will end in foreclosure, resulting in a $164 billion loss to homeowners. This exceeds the worst foreclosure experience heretofore, during the oil bust of the 1980s, which had a ripple effect on the economy and entire neighborhoods.

The loss of billions in home equity by millions of Americans deserves as much attention as the stabilization of a lending market based on questionable practices such as the ARM, the balloon note, the early prepayment penalty and limited documentation of borrower's income. The relevant questions are how to prevent additional foreclosures and how to curb the excesses and abuses of the subprime market.

In the months to come, national leaders will focus on whether to provide aid for those at risk of foreclosure through grants or loan renegotiation. If borrowers have inadequate income to pay a mortgage, subsidies or renegotiated loans might only postpone the inevitable foreclosure.

But, if talk should turn to a bailout for the system, the homeowner should be considered first. By staving off foreclosure, all the participants in the chain, from homeowner to equity investor, are protected. Any infusion of funds at the level of mortgage lenders, investment banks or institutional investors might prevent market instability but would do nothing for the homeowner in foreclosure.

The subprime crisis results from undue risks taken by a minimally regulated market promoting loan products that have set homeowners up to fail. Since the loan originators don't hold the loans, which mortgage lenders sell to investment banks, the buyer deals with a salesperson who isn't overly concerned with his ability to pay.

Educating potential borrowers about these practices and loan products is an essential first step. Caveat emptor is the first line of defense in a market that has no stake in its customers' success. The National Urban League wisely proposes the doubling of the Department of Housing and Urban Development's budget for housing counseling.

Subprime lending practices need closer regulation. If a borrower is offered an ARM loan, the lender should be responsible for ensuring the borrower is qualified to pay at the highest potential rate rather than the lowest. Texas law disallows many of the subprime loan tools. Texas statutes should further constrain rather than promote their use.

Home ownership is the prime underpinning of the American dream. The irresponsibility and opportunism of brokers and lenders that resulted in a problem of this magnitude require the same government attention given to other financial markets.