Posted on 01/03/2005 10:28:40 PM PST by nanak
MILWAUKEE - In a pilot program described as the first of its kind, an agency created by the state government is making it easier for illegal immigrants in Wisconsin to obtain mortgage loans.
Immigrants who do not have Social Security numbers - a common requirement for loans - can use an alternative government-issued tax number to get financing for new homes, under the Wisconsin Housing and Economic Development Authority (WHEDA) program.
Many holders of the Individual Taxpayer Identification Number (ITIN) are living and working illegally in this country, even though they pay taxes.
Some say the Wisconsin program is an example of how groups and companies are starting to recognize the potential market of immigrants. Critics say the program provides a reward for those who are violating immigration laws.
Some banks already issue mortgage loans to illegal immigrants, but WHEDA is believed to be the first and only quasi-government organization to buy such loans from the banks, said Geoff Cooper, director of emerging markets for MGIC Investment Corp., and Gary Acosta, president of the National Association of Hispanic Real Estate Professionals.
"Anyone will tell you the real growth in home ownership in the state, in the country, is in the minorities and immigrant market," said Antonio Riley, executive director of WHEDA, a public corporation created by the Wisconsin Legislature in 1972.
The agency, which funded more than 4,000 home mortgages last year, underwrote 87 mortgage loans to ITIN holders since the program started in April. Six banks in Milwaukee and Madison participate in it, and the authority has talked about expanding it to Racine, WHEDA spokesman Ron Legro said.
But state Sen. Glenn Grothman, R-West Bend, is threatening legislative action if WHEDA doesn't kill the program, which he contends rewards people for breaking the law.
"It is an insult to border guards and immigration officials who are trying to enforce the immigration law," he said. "It is an insult to people who are waiting patiently to enter the country legally."
Financial experts say WHEDA's program was simply a reaction to the country's changing demographics. Estimates of illegal immigrants in the country range from 10 million to 12 million, Acosta said.
"If this becomes a standard in the industry it could have a multibillion-dollar positive impact on the economy," he said.
Some private banks already write mortgage loans and open bank accounts for ITIN holders. MGIC, a Milwaukee-based issuer of private mortgage insurance, started insuring ITIN loans last fall.
Using the tax numbers allows banks to know the true identities of immigrants, who might otherwise go to predatory lenders or use false Social Security numbers to get mortgage loans, MGIC's Cooper said.
ITIN was created in 1997 for the Internal Revenue Service for foreign citizens who needed to pay taxes in the United States but could not obtain Social Security numbers. The government has issued about 7 million ITINs as of last year, the IRS said.
ITIN gained currency in the financial market after banks realized the potential of the immigrant market.
About 70 percent of immigrants from Latin America are "unbanked," said Michael Frias, community affairs officer at the Federal Deposit Insurance Corporation.
Even the Patriot Act, created to fight terrorism after the Sept. 11, 2001, attacks, acknowledged ITIN is an acceptable form of identification for banks, said Frias, who spearheaded a Midwest task force to extend banking services to immigrants.
Milwaukee's Mitchell Bank was among the first in the nation to have an ITIN loan program. The bank on Mitchell Street served European immigrants in the neighborhood in the early 1900s. As years went by, Hispanics replaced the Germans and Poles, said James P. Maloney, the bank's president and chairman.
"As the neighborhood changed, we ultimately decided we had to change or move," he said.
The bank now hires Hispanic employees, has all documents in Spanish and is authorized to help immigrants obtain ITINs. It created credit history for immigrants who often don't have any by examining their utility bills, rent payments and the money they send home. The ITIN loans performed better than conventional loans, Maloney said.
The home ownership rate on Milwaukee's largely Hispanic South Side is less than 20 percent, and the immigrant market is "more than we could ever handle," Maloney said.
But the bank has limited capacity for ITIN loans, because companies that usually buy mortgage loans from banks refuse to underwrite these loans, saying they are too risky, Maloney said. The WHEDA program fills that void.
"It's very forward thinking on their part," he said. "They couldn't be doing anything better for our neighborhood."
But Acosta said unless the major players enter the market, the WHEDA program will have minimum impact on the industry.
"Unless Fannie Mae, Freddie Mac and FHA (Federal Housing Administration) start doing this type of loans, it's only going to have a marginal impact."
GREAT. Next, the taxpayers should make MORTGAGE payments when ILLEGAL ALIENS default to show COMPASSION.
WHEDA is believed to be the first and only quasi-government organization to buy such loans from the banks
No wonder we have a REAL ESTATE BUBBLE. When POP goes the REAL ESTATE bubble, we will have chaos.
I think we reached the low point, and it gets worse.
Residents should sue the state for aiding and abetting a criminal enterprise. I would if I lived there!!
"Unless Fannie Mae, Freddie Mac and FHA (Federal Housing Administration) start doing this type of loans, it's only going to have a marginal impact."
The day that happens there will be heck to pay..
Either that, or the U.S. should stop pretending to be a nation, with sovereign borders, and just admit that it's a hang-out for anybody who's able to wiggle onto its soil. It's the hypocrisy that's most galling.
I bet these loans required these new illegal alien, non citizen, but registered democrat voters are required to move into red counties.
ping
what about the default rates? Will illegal aliens be able to file for protection in the bankruptcy federal courts?
Even if they are able, will they want to risk "la migra"? (a federal judge's obligation to report the illegal?)
This will create a forclosure class which will be another problem to be "fixed".
Paving the way for America's? President to implement his FTAA and Totalization plans to destroy this country's sovereignty and culture.
Good Lord!
I am telling everyone, their plan is to completely undermine our borders and our sovereignty.
Eventually, citizenship will be pointless.
corporate 'coyotes' looking to pad the bottom line at everyone else's expense.
What do the American poeple know about FTAA?
Is it discussed at any length by any members of the media or the parties in control of our government?
After all, are we all not citizens of the world and, therefore, no longer in need of those pesky borders?
Coming soon? the selling out of sovereignty as a relic of a bygone era in global politik.
Americans are no longer in charge of America. This monstrosity will be forced upon us, and we don't have any say about it. Anything that deals with Mexico seems to have a free pass in George Bush's White House.
I guess we could call it a silent invasion,, but it really isn't,, more like an ignored one... encouraged by the same folks who swore oaths to defend and protect our nation from all enemies, be they foreign or domestic, or next door.
senators and reps are much too busy with more important things like pushing for constitutional amendments to allow for the election of non-native born americans and such or passing campaign reform that really is neither reform nor sensical in its 'design'.
And think of all of our current soldiers, our parents grandparents who suffered and died for our freedom here, and scum sneaks in and is accorded SPECIAL privileges. Good God!
No excrement!!!!
bttt
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