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.
With five or six families in the home and a at least that many junk cars in the driveway, it can be done.
The story says nothing about ILLEGAL immigrants.
Immigrants who own homes are strong supporters of property rights. Most home owners support individual rights in property and don't give money to eco-fascists at the Sierra Club.
Owners of property vote conservative. Renters in big cities vote rat.
Provide easy credit to folks who eventually can't take on the payments (and the high interest rates). The realtors make a killing, while the creditors call for a bailout or "loan guarantees."
Judging from what I have seen happen to folks who get HUD loans, this would only make a bad problem worse.
I'm not surprised. Citibank is a POS company.
That's all I need to know...ACORN.....aren't they involved with the 35,000 fraudulent ballots in Missouri...and so far that's all they're suspected of?
This sounds great! I am going to take Spanish lessons, go to Mexico and come back as Montago Diaz. Gimme a house!
"ACORN"
Where ever and whenever you see this acronym, fraud will soon follow.
So now we have big crooks who run a scam system who want to acctract little crooks who will scam the scam system because the big crooks will profit when the little crooks scam (try saying that fast). Meanwhile, if you are honest and pay your bills you will be treated like filth -- they will make it hard for you to get a loan and you will be taxed to subsidize the big crooks.
"... will the person whose NAME the loan is in be able to make up that protion of the payment?"
You're going out on a limb here, assuming that anything other than an alias was used for the mortgage application. The financial industry is losing its collective mind.
I hope this backfires and the illegals and other high-risk people they want to recruit end up destroying the houses they "own." I have heard stories where people who know they will eventually default on a loan just let their property fall apart -- they treat the property like the worst slob renter from hell would. They mash up the furniture and bang holes in the walls and anything not firmly attached is stolen (people even steal the pipes to sell for drug money). I hope these greedy lenders who want to offer deals to illegals get piles of rubble when it is time to reposess a house.
Yes, it does. Paragraph #1:
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.
The article uses euphemisms like "new immigrant home buyers" and "recent immigrants", but the article is talking about illegal aliens.
ping
But being a builder means that all they have to do is send in a crew that is already on the payroll. They could redo a trashed out house in less than a week and make it look brand new.
Get a 6% mortgage on a 400K home and you get a $2K monthly payment. Divided by twenty people crashing there, that's $100/person/month
If I remember correctly, falsifying information on a loan application is a criminal act... But then, what's the big deal if the person applying for a loan is already committing a crime by being here illegally?
I'm just at a complete loss for words, and I'm getting disgusted with the whole thing. Why should ANYONE be expected to follow laws, when we repeatedly see how law breakers are treated... They're given breaks on tuition, given subsidies for food, housing, and medical care, and now, given preferntial treatment in buying property?!?!?!
UN-F*****G-BELIEVABLE!!!!
Mark
ACORN needs to be looking down the barrel of a RICO prosecution, and soon.
ping
North American Union, here we come!
"But being a builder means that all they have to do is send in a crew that is already on the payroll. They could redo a trashed out house in less than a week and make it look brand new"
BS!
A number of years ago I bought one of those from HUD.
For $21k I got a 4 bedroom home that was nothing but a shell, roof and exterior walls. No windows doors cabinees interior walls plumbing or electrical, every bit of it had been ripped out and sold for scrap.
After rebuilding it I came out with 4 times my investment in profit but you don't do it in a week!
That's how they get them back!
"But what happens to the loan when/if they are deported?"
They aren't, the fact that they are property owners allows them to apply and get perminant residence statis.
That is the scam they are pulling!
I saw it happen in Glendale just before Hong King went over to the communists. They came in, bought a house, usually before they ever set foot in this country sight unseen, and were given immediate legal residence statis.
more on ACORN (at least the fraud-vote group)
http://www.pipelinenews.org/index.cfm?page=acorn110306.htm
Swell. If we ever do start deporting illegal aliens in large numbers, government-backed mortgages will start defaulting and the taxpayers will be stuck with the bill.
Then I would suggest that you make sure your finances are in order and a bit of cash is on hand because someone with your background would have a better chance than the rest of us at being an overnight billionaire by buying up the defaults and renting back to the ones already living there.
The whole thing sucks but you might be in a position to make lemonade...
Seeking expert commentary...
I don't want illegals buying houses. I want them to go back home. That didn't take much expertise.
Ill second that but what do you see as its effect on the market should this come to pass?
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