The 110th Congress is considering legislation that would limit an increasingly popular mortgage concept: providing home loans to applicants using an Individual Taxpayer Identification Number (TIN) in lieu of a Social Security number.
ITINs are issued by the Internal Revenue Service to assist immigrant workers who do not qualify for a Social Security number to report their income and pay federal taxes. Many of the immigrants who use ITNs to apply for loans are actually in the U.S. legally, but have not completed the immigration process and received their Social Security numbers.
Banks around the country have started offering home mortgages to undocumented immigrants using ITINs, but their programs largely unnoticed and small in number. However, when Bank of America announced a pilot program in Los Angeles to provide credit cards to resident alien customers who lack Social Security numbers but have ITINs, they provoked a controversy that resulted in the proposed legislation.
Tim Sandos, president and chief executive of the National Assn. of Hispanic Real Estate Professionals, has estimated that there are as many as 7–8 million legal resident immigrants in the United States who do not have Social Security cards but are in some phase of the immigration process leading to citizenship. That process can take years and “meanwhile these individuals are working here, earning incomes, paying taxes, contributing to the economy.”
So it appears that this legislation, targeted at the undocumented, will hurt those who are in the country legally. You know, the ones who are “playing by the rules,” as it is so often termed in the immigration debate. The question that we should be asking is “how many undocumented people actually take advantage of these loan offers?” My guess it that the number is pretty low, as it is difficult to amass assets when you’re employed at the bottom of the U.S. labor market. Until we know that number, however, it is impossible to determine whether this is a problem that needs to be addressed legislatively. And if it is, this particular legislative approach is not the way to address it.