Illegal immigration and the mortgage mess

Michelle Malkin's picture

The Mother of All Bailouts has many fathers. As panicked politicians prepare to fork over $1 trillion in taxpayer funding to rescue the financial industry, they’ve fingered regulation, deregulation, Fannie Mae and Freddie Mac, the Community Reinvestment Act, Jimmy Carter, Bill Clinton, both Bushes, greedy banks, greedy borrowers, greedy short-sellers and minority home ownership mau-mauers (can’t call ‘em greedy, that would be racist) for blame.

But there’s one giant paternal elephant in the room that has slipped notice: how illegal immigration, crime-enabling banks and open-borders Bush policies fueled the mortgage crisis.

It’s no coincidence that most of the areas hardest hit by the foreclosure wave — Loudoun County, Va., California’s Inland Empire, Stockton and San Joaquin Valley, and Las Vegas and Phoenix, for starters — also happen to be some of the nation’s largest illegal alien sanctuaries. Half of the mortgages to Hispanics are subprime (the accursed species of loan to borrowers with the shadiest credit histories). A quarter of all those subprime loans are in default and foreclosure.

Regional reports across the country have decried the subprime meltdown’s impact on illegal immigrant “victims.” A July report showed that in seven of the 10 metro areas with the highest foreclosure rates, Hispanics represented at least one-third of the population; in two of those areas — Merced and Salinas-Monterey, Calif. — Hispanics comprised half the population.

The amnesty-promoting National Council of La Raza and its Development Fund have received millions in federal funds to “counsel” their constituents on obtaining mortgages with little to no money down; the group almost succeeded in attaching a $10-million earmark for itself in one of the housing bills past this spring.

For the last five years, I’ve reported on the rapidly expanding illegal alien home loan racket. The top banks clamoring for their handouts as their profits plummet, led by Wachovia and Bank of America, launched aggressive campaigns to woo illegal alien homebuyers. The quasi-governmental Wisconsin Housing and Economic Development Authority jumped in to guarantee home loans to illegal immigrants.

The Washington Post noted, almost as an afterthought in a 2005 report: “Hispanics, the nation’s fastest-growing major ethnic or racial group, have been courted aggressively by real estate agents, mortgage brokers and programs for first-time buyers that offer help with closing costs. Ads proclaim: “Sin verificacion de ingresos! Sin verificacion de documento!” — which loosely translates as, ‘Income tax forms are not required, nor are immigration papers.’”

In addition, fraudsters have engaged in massive house-flipping rings using illegal aliens as straw buyers. Among many examples cited by the FBI: a conspiracy in Las Vegas involving a former Nevada First Residential Mortgage Company branch manager who directed loan officers and processors in the origination of 233 fraudulent Federal Housing Authority loans valued at over $25 million.

The defrauders manufactured and submitted false employment and income documentation for borrowers; most were illegal immigrants from Mexico. To date, the FBI reported, “Fifty-eight loans with a total value of $6.2 million have gone into default, with a loss to the Housing and Urban Development Department of over $1.9 million.”

It’s the tip of the iceberg. Thanks to lax Bush administration-approved policies allowing illegal aliens to use “matricula consular cards” and taxpayer identification numbers to open bank accounts, more forms of mortgage fraud have burgeoned. Moneylenders still have no access to a verification system to check Social Security numbers before approving loans.

In an interview about rampant illegal alien home loan fraud, a spokeswoman for the U.S. General Accounting Office told me five years ago: “[C]onsidering the size of Los Angeles, New York, Chicago, Houston and other large cities throughout the United States known to be inundated with illegal aliens, I don’t think the federal government is willing to expose this problem for financial reasons as well as for fear of political repercussions.”

The chickens are coming home to roost. And law-abiding, responsible taxpayers are going to pay for it.


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Submitted by qwsx on Wed, 11/11/2009 - 3:19am.

How to avoid illegal immigration and the mortgage mess?


Submitted by gido1018 on Fri, 02/13/2009 - 9:01am.

Those who study mortgage trends have said that there has been a pretty consistent pattern of a "bust" in mortgages about every 18 years since World War II. We've seen problems like this before and we will survive this "crisis." If you're looking for a mortgage right now, rates are still very good. The world is not ending (as the politicians who are itching to "help" would have us believe).

Now to your question... In summary, EVERYONE involved played a part in the "mortgage mess" to some extent or another.

Submitted by skyspy on Fri, 02/13/2009 - 9:33am.

This is a great time to buy homes and property. I recently closed on another property 4.25%. Great rates and good deals.

S. Lindsey's picture
Submitted by S. Lindsey on Wed, 02/04/2009 - 1:03pm.

I had a FBI (Federal Bureau of Intimidation)agent tell me once "it is all links in a chain.. enough chain and you can sink a ship".. Well this ship sailed a long time ago and has become adrift and taking on water.. Shark infested waters, and no help on the horizon.. and the current crew in Washington is either halfway to the lifeboats or trying to bail water with a papercup..The rest of us.. well we are still listening to the band...nodding our heads while being told it is all good.. Change has arrived to make it all better..
I have my own personal bailout package ready.. Do you?

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Submitted by mysteryman on Wed, 02/04/2009 - 8:47pm.

Guess it gonna be a rough first hundred days for O-Dog, cant seem to find any good help to man the helm, seems like no ones at the wheel, could they have already started to jump ship, guess all the Cadillac and gas money was spent at the soriee, as he an Michelle rode around to all the balls. Time to wipe off the cosmoline, and tape up some clips.... PEACE

Submitted by tibuan on Wed, 02/04/2009 - 12:51pm.

You should research what the process to becoming a permanent resident is like.
You don't just fill out a form and ask to be a resident. The process is very tedious and only a certain number of people are chosen. The process becomes more difficult if you're from a certain country. It's also very costly.
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