Just to start your day off on the wrong side of the temper. And, no, don’t bother emailing me asking for headache remedies. Mortgage Prospects Dim for Illegal Immigrants
Jose Luis Hernandez rose from vegetable chopper to sous chef at an exclusive New York restaurant — and saved $100,000 along the way. Recently, the illegal immigrant from Mexico contacted real-estate agents in Brooklyn, N.Y., where he currently rents an apartment.
“I wanted to use my money as a down payment on a house,” says Mr. Hernandez, 32 years old. In doing so, he sought to join thousands of undocumented workers who in recent years have purchased homes using an Individual Taxpayer Identification Number, or ITIN, instead of a Social Security number. The Internal Revenue Service doesn’t give Social Security numbers to illegal immigrants; it issues ITINs, which enable them to open bank accounts and report their income to the government for tax purposes.
But Mr. Hernandez quickly learned that things have changed. He says he was told that, “unfortunately, if you don’t have a Social Security number, you cannot buy property.”
Dubbed ITIN mortgages, the loans that made homeownership a reality for thousands of undocumented workers have withered — although not because they underperformed.
The loan program highlights contradictions in U.S. polices toward illegal immigrants. Even as the Department of Homeland Security sought to deport them, the Federal Deposit Insurance Corp. goaded banks and credit unions to bring undocumented immigrants into mainstream banking if they could prove they had steady income and were creditworthy. Beginning in 2003, when banks and credit unions first offered mortgages to undocumented immigrants, the small segment blossomed. The mortgages performed better than some others, partly because of stringent lending criteria and because they usually had fixed rates over a period of time.
Questions flying through my head include “what idiots came up with that program?”, “why are illegal aliens being given tax-payer identification numbers?” and “how much did this program have to do with the housing meltdown?”
He should have registered as an illegal and applied for citizenship a long time before he thought about buying a house.