Posted on 11/04/2006 4:40:33 AM PST by radar101
The slumping housing market could get a $200 billion boost from new immigrant home buyers if mainstream lenders start using alternative methods to score credit, a national group of Hispanic realtors said Friday. Creditors like Citigroup Inc.'s Citibank see recent immigrants as a growing market niche, but those who lack Social Security numbers or legal status in the U.S. are often rejected by the three major credit bureaus.
A handful of new credit reporting systems already used by 200 real estate brokers, community groups and mortgage counselors nationwide allows them to calculate risk by evaluating a prospective client's utility bills and rent checks.
Should the new reporting methods gain wider acceptance on Wall Street and among secondary mortgage lenders like Fannie Mae, housing markets in places like California's Central Valley would stand to gain the most, the National Association of Hispanic Real Estate Professionals said.
“Gateway states like California and Texas will disproportionately benefit from the housing boom because so many of their residents are immigrants,” said Gary Acosta, the association's co-founder, speaking from the group's annual convention in Las Vegas. “Boosting homeownership among these populations is a positive contribution to the overall fabric of our society and our economy.”
A study by the Joint Center for Housing Studies at Harvard University shows Latinos will account for nearly one-third of the home-buying pool by 2010. That same year, the disposable income of Hispanics will exceed $1.08 trillion, or 9.2 percent of total purchasing power nationwide, according to the Selig Center for Economic Growth at the University of Georgia.
No law requires that buyers be in the country legally in order to purchase real estate, Acosta said. Citibank, for instance, doesn't require that borrowers be citizens or legal residents of the United States, Citigroup spokeswoman Janis Tarter said.
As with many other minority and immigrant communities, bringing Hispanic families into the mortgage market is a continuing challenge, say officials at Federal Reserve Banks across the country.
Community groups from California to Atlanta have begun offering financial education classes in Spanish as the number of mortgage products available to immigrants and underserved populations has grown.
In Fresno, the housing advocate ACORN Housing Corp. helps clients secure loans by writing alternative credit profiles, which often draw on of months of data from telephone bills and employment records, said Lydia Lopez, the group's local manager. Once ACORN vets the client's financial stability, they send them to Citibank, which finances the home loans.
Automating that process by using programs like First American Corp.'s Anthem service, which generates a credit score using the nontraditional data, will help new immigrant clients win prime-grade financing and acceptance in the secondary market, said Acosta.
Voting immigration with your pocketbook= Selling your country for CASH
Where is the justice in this country?
Translation: "The hole Middle America has dug for itself isn't deep enough and we want to bring in 'guest workers' to help dig."
"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." -Manuel II Paleologus
There goes the neighborhood and my investment.
sw
I have a better idea.
Just let homebuyers use imaginary money!
Then prices will really soar!
What an economy THAT will be!
If these new systems are widely accepted, there will be
a flood of mortgages in default within a year or two
of the sale. I worked 10 years in "second-chance" financing for automobiles and what the lender sitting in his/her office will not know is this....How many illegals
will be living in that house and what per cent of the rent are they responsible for? When they move out, or are caught and sent back, will the person whose NAME the loan is in be able to make up that protion of the payment?
Who was the "landlord" that provided rent receipts to help the illegal applicant establish a payment history: brother, cousin, uncle? Is that payment history even legitimate? Etc, etc., etc., These are the problems we encontered on auto loans approved thru sources other than those using credit scores....fraud, fraud, and more fraud.
Over 10 years, I worked for Mercury Finance,Reliance Acceptance, First Merchants Acceptance, and Long Beach Acceptance. All are now out of business. Each one had their own "alternative scoring" system.....
They are. We call them "dollars."
But these CRIMINALS can just waltz right in, with unverifiable information and buy a house? What's wrong with this picture.
I hope the banks that give loans to these criminals find themselves totally screwed, they'll deserve it.
seems we need laws to say you must be LEGALLY in the USA to buy in this country.
How about selling to an illegal means you have no recourse to enforce collection. (ala illegal gambling debt)
That doesn't leave much after much after the projected spending of $1.0 trillion on Low-Rider automobile modifications and Pupusas. (:^*)
That doesn't leave much after much after the projected spending of $1.0 trillion on Low-Rider automobile modifications and Pupusas. (:^*)
Oops, I stuttered.
Here in Texas many builders are financing their new homes with no money down.
Fraud is rampant in the mortgage industry these days. Money talks, not politics.
But what happens to the loan when/if they are deported?
The REALTORS are the LARGEST LOBBY IN DC!
Wonder how many terrorists my mortgage company is funding?
Don't ask don't tell policy in play?
I believe that a majority of home buyers are going no money down. I did. Can't think of a good reason to make a down payment on a interest rate < 6.
Read my post 15. They simply reposses it, clean it up and resell it.
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