Despite Illegal Status, Buyers Get Home Loans

Each week, Pedro Morlet knocks on doors in the Bay Area, looking for illegal immigrants.

Morlet isn’t an immigration agent. He’s a real estate agent, and he’s scouting for business.

“Do you want a house, work and pay taxes but don’t have a Social Security number?” reads his flier, written in Spanish and tailored to his potential customers. “We can help you LEGALLY!”

Across the country, particularly in Texas and parts of the Midwest, hundreds of illegal immigrants have bought homes using special lending programs that bypass the need for a Social Security number. Now, with backing from some of the country’s largest financial institutions, this newest effort to tap customers for the real estate market is moving to the nation’s largest concentration of illegal immigrants — California.

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Lenders have a powerful incentive to find ways to get around those barriers: tens of thousands of potential customers. The National Assn. of Hispanic Real Estate Professionals estimates that more than 216,000 undocumented immigrants, including many who have been in the country for decades, could buy homes if they had better access to the market.

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Silvia Avalos, a hairstylist, and her husband, Jose Luis Avalos, a busboy, are among the people Mancera is talking about. They were tired of spending their money on rent each month but didn’t want to use fake Social Security numbers to buy a home.

After friends told them they could buy legally, they found a two-bedroom condo northeast of San Francisco for $280,000. They moved in as soon as escrow closed.

“We saw it as an investment,” Silvia Avalos said. “While you are here, you have somewhere to live that is yours. And if you return home [to Mexico], you can sell it.”

Another prospective buyer, Aaron Sanchez, was pre-approved for a $200,000 loan after taking a class sponsored by ACORN, an advocacy group for the poor, on how to make offers and apply for mortgages. The 32-year-old illegal immigrant from Oaxaca, Mexico, has worked at the same furniture company in the San Gabriel Valley for 14 years. He wants each of his two children to have a room. It is a luxury, he knows, that will be hard to afford.

“I think I can find a house,” Sanchez said, “but a small house.”

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Some banks are reluctant to take the risks involved in the illegal-immigrant market. “If someone were to get deported, what happens?” said Cynthia Mendoza, an account executive with Bank of America. “It’s a loss to the bank.”

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