Irregular Immigrants Not Responsible for the Mortgage Crisis

The Wall Street Journal reports that irregular immigrants are not responsible for the mortgage crisis contrary to what many people have insisted:

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.

But, amid the crackdown on irregular immigration and the economic slowdown, the market for immigrants who boast the alternative nine-digit taxpayer ID is dying, and hardly any banks are now providing these loans.