Thread: Hannie Mae Hispanics had taken out 40% of subprime loans

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Fannie, Freddie And Now, Hannie
INVESTOR'S BUSINESS DAILY

Posted 1/15/2009

Subprime Crisis: The media have pounded President Bush for a wave of Hispanic home foreclosures. But it was Democrats who launched a drive to loosen credit for Hispanics — many of them illegals.





Democrats and their advocacy groups also prodded Fannie Mae and Freddie Mac to buy the high-risk NINJA (no income, no job, no assets) loans they'd pressured banks to make to Hispanic immigrants. Now immigrants are defaulting on subprime mortgages in droves, adding to the toxic debt that is poisoning the financial industry.

Yes, Bush was "eager," as the Washington Post described it, to put more Hispanic families into their own homes, even setting a goal of higher minority homeownership soon after taking office.

But Bush didn't pressure lenders to adopt sloppy underwriting standards. Nor did he encourage Fannie and Freddie to underwrite subprime loans to meet quotas for minority lending.

That was done under the previous administration. The groundwork for disaster was laid by Clinton and his social engineers — in this case, former HUD chief Henry Cisneros, now a major lobbyist for Latino homeownership.

During the Bush years, the Congressional Hispanic Caucus fanned the flames of the crisis. Led by Democratic Rep. Joe Baca, whose California district is 60% Hispanic, the caucus teamed up with a lobbyist group that Cisneros advises — as well as La Raza and other inner-city agitators — to pressure Fannie and Freddie into making risky subprime loans to Hispanic immigrants that required neither income nor asset documentation.

By 2006, before the bubble burst, Hispanics had taken out 40% of all subprime loans. Now these chickens are coming home to roost. The mortgage giants, internal memos show, warned that although the loans were popular with Hispanic borrowers, they had much higher delinquency rates of 8% to 13%.

The loans were aggressively pushed by a Hispanic lobbying group advised by Cisneros, who originally set the minority lending quotas at Fannie and Freddie. Even as foreclosures mounted, the Washington-based National Association of Hispanic Real Estate Professionals, known as NAHREP, lobbied lenders, as well as Freddie and Fannie, to ease down-payment and credit standards for immigrants.

"NAHREP maintains that California, Texas and other states with large numbers of immigrants could see a dramatic jump in homeownership if a greater number of major lenders adopted alternative credit-scoring systems," the group said in a 2007 report that included a foreword written by Cisneros, urging the closing of the homeownership gap between Latinos and whites.

Giving new meaning to chutzpah, NAHREP and the caucus now blame subprime lenders for the flood of Hispanic foreclosures, claiming Hispanics fell prey to their "predatory lending practices."

Not so fast. According to a recent Federal Reserve report, the problem centers on bad credit. Hispanics and African-Americans, on average, "have lower credit scores than non-Hispanic whites and Asians," it found. They also have higher default rates on mortgages — and not just higher-cost subprime mortgages, but all types of loans, the Fed noted.

Hispanics defaulted for the simple reason that they were less likely to qualify to own a home in the first place. Least-qualified were illegal immigrants, but that didn't faze NAHREP and the Hispanic caucus on Capitol Hill. They actually encouraged lending to aliens.
No Social Security? No problem. NAHREP pushed the use of ITINs — individual tax information numbers — along with the Mexican-issued Matricula Consular cards in lieu of Social Security numbers.

By law, banks don't have to check immigration status, and after heavy lobbying by Hispanic housing advocates, they made loans to illegals — lots of them. By some estimates, millions of undocumented workers became undocumented borrowers almost overnight.

Until recently, ITIN mortgages couldn't be sold on the secondary market, as Fannie and Freddie wouldn't touch them as a matter of policy. So with the support of NAHREP and the Hispanic caucus, "Hannie Mae" was created — the Hispanic National Mortgage Association, based in San Diego. And it began buying ITIN mortgages from lenders, helping them spread the risk.

Now Hannie Mae itself risks defaulting on more than $200 million in loans it has acquired. These politically correct casas were built on sinking sand, and now we're all having to foot the bill.
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Hispanics defaulted for the simple reason that they were less likely to qualify to own a home in the first place. Least-qualified were illegal immigrants, but that didn't faze NAHREP and the Hispanic caucus on Capitol Hill. They actually encouraged lending to aliens.


no surprise here

I know hard working tax paying Hispanic citizens are just as outraged with Baca and his Merry Band of Thieves as the rest of Americans.

Baca seems to only represent IA's and fringe hate groups like La Raza with little thought to how he is hurting those he pretends to represent.I hope Hispanic voters show him the door come election time cause he does not represent American Citizens !!

Good article jimpasz. Should be on the front page of newspapers but won't hold my breath on that.

Yep, and now we and generations after us will have to pay for this insane mess.

Yep ... good find. I have never heard of Hannie Mae prior to this. Forwarding to friends and family

Added to Homepage:
http://www.alipac.us/article-3901--0-0.html

You would have to assume at least 75% of these loans went to illegal aliens or recent legal immigrants. Most American Hispanics have enough income and credit history that they don't need a subprime loan.

The bottom line is, excessive unrestricted immigration has caused the global economic meltdown. And here we were told incessantly for decades how great it is for our economy!!!

Now the light is beginning to shine....that's where the bailout money that the Fed doesn't want to tell us where it went was and is being used....to bailout the mess made by our governments corupt anti-American immigration policy!!!

And here we were have been told incessantly for decades how great it is for our economy!!!

People pulling their own weight, maybe? You just can't have an open border in a welfare state.

Just another example of illegals having more rights than U S citizens. But why would a country like the U S or any country for that matter give invaders more rights than its own citizens? It is irrational. But it does make sense if you assume that somebody or some group was trying to wreck the U S economy. It's almost as if terrorists were running the system.