A lender working at JVN Lending, based in Walnut Creek, California, Heidi Ameli says she’s used to talking to one ITIN (Individual Taxpayer Identification Number) borrower a week, at least. She’s one of the team’s Spanish speaking staff members, so potential ITIN borrowers make up a considerable portion of her client base.

Lately though, she’s noticed a trend: they’ve started to drop off.

“We’re hearing mostly through our Realtors, ‘I’m not going to refer you the next few clients that I had planned to. They told me [it’s] because they’re paying close attention to regulatory headlines before making any financial moves at all.’ So people are hiding at home to see what happens, basically, like they’re under the covers. They don’t want to be seen. They don’t want to put any financial information anywhere.”

The fear driving this retreat isn’t exclusively financial, though. There’s possible deportation at stake.

Andrew Arthur, a former immigration judge and Fellow in Law and Policy at The Center for Immigration Studies — a conservative think tank that advocates for stricter enforcement — argues that ITIN lending undermines immigration control.

“From an immigration perspective, it doesn’t make any sense,” he says. “When you purchase a home, it allows you to build equity in this country — it’s going to make it harder to deport people.”

To Arthur, ITIN loans don’t just create risk — they create permanence. And in a political moment increasingly defined by deportation logistics, financial permanence is seen as a barrier to effective and efficient immigration policy.

In lending communities, however, financial permanence is an opportunity.

Over the past several years, the push to integrate ITIN borrowers into the dream of American homeownership has led to an outpouring of specialized loan products from wholesale and retail lenders alike. Acra Lending, an Orange County-based lender, prominently touts an ITIN program with 80% LTV and loan amounts up to $1 million. Bank of America, through the Community Affordable Loan Solution, offers a $10,000 credit toward down payment. Rate advertises an “all-Spanish mortgage experience.” The list goes on.

ITIN holders, after all, represent a largely untapped portion of the potential housing market; a 2024 report from the nonpartisan research group Urban Institute found that although there are some 5.25 million ITIN holders currently residing in the US, fewer than 6,000 ITIN mortgages were closed in 2023. The study indicates that with additional assistance from specialized programs, that 0.1% of ITIN homeowners could balloon to about 88,000, possibly higher.

As deportation threats escalate, though, ITIN borrowers are retreating from the housing market — and lenders are starting to wonder whether these loans are still worth the risk. But the real question may not be whether or not to pull back, but if, in this moment, holding steady might actually be the smarter play.

High Effort, High Reward

ITIN mortgages first gained traction in the early 2000s, after President Bush issued a ruling making ITINs permissible forms of identification for CIP purposes under the USA PATRIOT Act. The economic potential of undocumented immigrants, who today collectively pay $11.74 billion in taxes per year, was hard to deny. Many — 54% of Mexican-born immigrants, for example — were unbanked at the time, and bringing them into the American financial fold meant more documentation, tracking, and of course, revenue.

ITIN mortgages, non-qualifying by definition, also have significantly higher terms. “When it popped up, it was 30% [minimum] down payment,” Ameli says. “Then it was 25, and now we can get some at 20% and some states do 15.” The minimum down payment for a U.S. citizen, by comparison, is 3%.

Beyond the down payment, ITIN loans have a higher LTV ratio and require more initial “homework,” as Ameli puts it. “Income, asset, credit, and the ITIN number itself, verifying the IRS paperwork. All of that documentation is especially extensive, specific, and complex. Basically because of the increased risk of this loan type,” she explains. “The more risk, the more documentation.”

Put more granularly, ITIN borrowers must provide a valid ITIN card or IRS letter, a current passport, two years of U.S. tax returns, proof of steady employment, and hold a minimum credit score of 660 with at least two years of U.S. credit history. Documentation follows the line of a traditional mortgage application, but requires significantly more due diligence. The result is a mortgage process that is not only more demanding for the lender, but also more expensive and time-consuming for the borrower.

But also, like everything else, the more involved the loan is, the more money there is to be made.

Rogelio Goertzen, Chief Growth Officer at Empower Mortgage and the founder of Hispanic Organization of Mortgage Experts (HOME), speaks extensively about the benefits of ITIN loans through his platform.

According to their website, HOME is, “ … dedicated to increasing homeownership opportunities for Hispanic and Latinx Americans by equipping mortgage professionals with the education, exclusive tools, and resources needed to effectively serve this growing market.” Given that mission, Goertzen works with lenders to help them navigate the “homework” associated with ITIN lending.

Goertzen says the financial benefits make ITIN loans worth it for lenders. In a recent interview with NMP, he laid out the potential numbers, as he sees them.

“If we just do 10% of these loans, that’s $300 billion in production,” he says. “Which, according to the stats last year, beats the number one overall lender.” (As a point of reference, UWM’s total loan volume last year was $3.29 billion, according to Modex.)

For Goertzen, ITIN lending is not only a solid financial decision, however; it’s personally relevant. A second-generation American himself, he’s seen first-hand how monumental home ownership can be.

“My dad wouldn’t short sell his home during the ‘08 crash. I was trying to convince him that all my neighbors and my friends were doing it and they were buying mansions because they could do it. But my dad was so proud of his home that he didn’t want to go the traditional route. So my argument is the Hispanic community doesn’t take the easy route out. That they will look for a way to make sure that their mortgage payment is paid.”

In terms of data, there’s some evidence to support Goertzen’s anecdote — nationally, ITIN loans are less likely to default than the national average. In 2015, Guadalupe Credit Union, based in New Mexico, reported a 1.24% default rate on ITIN mortgages. Latino Community Credit Union in Durham, S.C., which issued 1,515 loans to DACA recipients, had a delinquency rate of 0.82% among them. The national average for mortgage defaults in 2015, by contrast, was 5.69%.

Additionally, immigrants are far more likely to live multigenerationally. Data from the 2022 U.S. Census shows that 11.8% of foreign-born people live with 3 or more generations in one household, compared to 7.4% of people born in the U.S. In Goertzen’s view, that means there will always be somebody around to pay the bill, whether that’s the primary owner or another adult relative.

While that may offer lenders some reassurance, the growing number of ICE raids — from college campuses to job sites — raises a more sobering possibility: what happens when the whole household is at risk? Even the most reliable payment plan can fall apart if every potential contributor ends up in detention.

Kyle Gunderlock, Chief Risk Officer at Acra Lending, doesn’t see that as a significant concern. “If someone is deported and they have equity in the property, they’ll either sell or rent it. They don’t just abandon their investment,” he argues. In his role as Head Trader for Acra Lending’s investment fund, a duty he’s had since 2007, he’s run the gamut of peaks and valleys in the mortgage industry. He agrees that ITIN loans are a risk — but a relatively secure one, in the grand scheme of things.

Others have publicly offered up similar sentiments to Gunderlock. As a guest on the Marketplace podcast, Bruce Marks, CEO of The Neighborhood Assistance Corporation of America (NACA), said that even when borrowers are deported, they will find a way to pay the mortgage.

“Within the immigrant community and within the family households there’s a plan B, C, and D. Who’s going to live there? Who’s going to take over the mortgage payments? All that stuff.”

Loans On The Line

At least for now, that’s the case. On March 26th, the Department of Housing and Urban Development (HUD) issued a new policy barring non-permanent residents from obtaining FHA-insured mortgages, effective May 25th. The move, couched in the language of “economic prioritization” for citizens and green card holders, shuts the door on access to one of the most affordable mortgage products in the country for entire classes of borrowers — including DACA recipients, individuals with work visas, and others in legal limbo.

While ITIN loans have never been FHA-backed to begin with, the announcement acted like a warning flare to the mortgage community: If the federal government is starting to draw hard lines around immigration status and mortgage access, lenders in the Non-QM space may soon be forced to follow suit.

“It likely won’t be a direct executive ruling from the administration that affects ITIN loans,” says Ameli. “But there’s a reason why they were gone from 2008 for many, many years.” After the Great Financial Crisis, Ameli explains, most lenders who offered ITIN and other sub-prime financing options pulled the plug. “It was a total shutdown. Vanilla loans only.”

It all comes down to risk analysis, says Ameli. “It’s always, how safe is this investment? So if they’re looking outward and thinking, are these individuals going to still be in the United States with a job paying this mortgage? If that feels unsteady and they don’t have good grounding, they’re going to make some different decisions about these loans. Not directly tied to the government’s decisions, but more like a trickle down effect.”

A 2008 discussion of nonresident lending on NPR highlights the real-time impact of the collapse on the undocumented population. In it, Tim Sandos, then-president of the National Association of Hispanic Real Estate Professionals (NAHREP), notes that despite a “delinquency rate of a half of one percent,” the tightening on ITIN mortgages could be attributed to “the political risk and reputational risk that comes with providing these types of loans.”

And there’s a potential that history could repeat itself. In addition to the HUD ruling, each day ICE inches closer to a partnership with the IRS, which, when implemented, will give immigration officials unfettered access to tax data of millions of undocumented residents. What was once a mildly risky investment could be a catastrophe going forward.

That’s the intent of the federal government, though, or at least appears to be. On the 2024 campaign trail, President Trump came down hard on homes for immigrants. At a speaking engagement at the Economic Club of New York, he said that he intended to ban mortgages for the undocumented, asserting that a recent “flood” of them had driven up housing costs for U.S. citizens. Recent policy suggests he might be well on the way to achieving his goal.

But in the face of more aggressive immigration policies, lenders remain hopeful — and confident — that there’s a long-term future and strong business potential in ITINs, if only one is willing to invest a little time. Goertzen and his colleagues at HOME among them.

“It might have some short-term impacts,” Goertzen acknowledges. “But I’m not worried about it.”

The immigration landscape may be shifting, but risk doesn’t always follow rhetoric. For ITIN borrowers and the lenders willing to work with them, the data continues to point toward long-term economic soundness. Goertzen hopes that by educating lenders on the consistent reliability of ITIN loans, they’ll stop seeing these borrowers as risks and start recognizing them as the future foundation of the American housing market.

“One of my favorite statistics is that 1 million American Hispanics turn 18 every single year and will continue to do so for the next 20 years,” he says. “So, I’m not just focused on the next four years. I’m focused on the next 20.”