Chao to the American Dream: New Law Bars Immigrants from Homeownership Loans in the U.S."
A measure by Donald Trump will eliminate access to Federal Housing Administration loans for undocumented immigrants, DACA beneficiaries and asylum seekers, among others.
The Donald Trump administration announced the elimination of Federal Housing Administration (FHA) mortgage loans for non-permanent immigrants. The Department of Housing and Urban Development (HUD) reported that only U.S. citizens will be able to access these loans in pursuit of protecting the “American Dream.”
HUD eliminates loans for non-permanent immigrants
Scott Turner, HUD Secretary, stated on his twitter account that “U.S. taxpayers will no longer subsidize open borders by offering mortgage loans to those who illegally enter the country”.
Scott Turner, HUD secretary, stated that taxpayers will not continue to subsidize loans for undocumented immigrants and accused Biden of manipulating FHA regulations.
In doing so, the Trump administration reverses a policy implemented in 2021 under the Joe Biden administration. "Biden manipulated FHA policy to allow illegal immigrants to take advantage of the American taxpayer's effort by financing a home. For those who follow the rules and work hard to buy a home, this is unacceptable," Turner commented in an official statement.
HUD notified FHA-approved lenders that as of May 25, non-permanent residents will no longer be considered eligible. Jeffrey Little, assistant secretary of housing, explained in a letter that immigrants without stable legal status present “uncertainty in their ability to meet long-term financial obligations.”
DACA beneficiaries and asylum seekers will also be excluded
According to The New York Post's analysis, the changes will affect beneficiaries of the Deferred Action for Childhood Arrivals (DACA) program, who were authorized to access these credits since 2021.
Now, neither they nor people with asylum applications in process will be able to apply for government-backed loans. Little stated that HUD does not have accurate data on how many immigrants obtained these credits in the past, as the FHA does not retain residency or citizenship information on applications.
What are the arguments behind the new measure?
The Trump Administration justified the decision by stating that it will prioritize access for U.S. citizens and permanent residents to publicly funded programs. Turner argued that the move is in response to the president's promise to “end subsidies to illegal immigrants.”
In addition, HUD cited a report by the Center for Immigration Studies indicating that:
59% of illegal immigrant households receive some form of government assistance, representing a cost of approximately $42 billion.
There are at least 9 million people in subsidized housing without clear verification of eligibility.
In addition, HUD also announced that it will work with the Department of Homeland Security (DHS) to block illegal immigrants from accessing public housing. This is part of a broader plan to reform the welfare benefits system and limit access to taxpayer-funded programs.
Is there a loophole?
A HUD source in Washington, who asked to speak on condition of anonymity, told Telemundo that those in the process of buying a home can obtain a case number with a current date that would allow them to access the loan before the new regulations go into effect.
A legal loophole would allow purchases to be closed until November, if the process began before May 25, according to internal sources
A legal loophole would allow purchases to be closed until November, if the process began before May 25, according to internal sources.
“Those who do not have permanent residency status can take advantage for at least six more months,” the HUD source said. This means that even if the closing of the purchase process is set for after May 25, the loan could still be approved.
