The (illegal) American Dream

From the Wall Street Journal:

Big Banks’ Loan Push: Illegal Immigrants
Mortgages Get Pitched To Underserved Market; Critics Find Some Risks
May 3, 2007; Page C1

The nation’s big banks, scrambling for customers, are pitching mortgages to illegal immigrants.

Two years ago, making home loans to people who are in the U.S. illegally was largely limited to community banks that wanted to revitalize neighborhoods by offering low-cost mortgages to local workers. There are signs that these loans, which comply with regulatory requirements and which represent a sliver of the nation’s $10 trillion mortgage market, are starting to take off in the broader banking industry.

J.P. Morgan Chase & Co. is developing a pilot program to pitch mortgages to illegal immigrants in Maricopa County, Ariz. If the bank proceeds, the plan could launch as soon as this summer. The New York bank joins Citigroup Inc., Wells Fargo & Co. and Fifth Third Bancorp, which also are experimenting with the loans.

Genworth Financial Inc., meanwhile, is testing insurance products tied to the loans. Deutsche Bank AG has teamed up with the Hispanic National Mortgage Association to develop a secondary market where big banks can sell and trade the loans, potentially reducing risk with keeping the mortgages on their balance sheets.

“Whoever hits the street first with these loans will be the winner,” says Timothy Sandos, president of the National Association of Hispanic Real Estate Professionals. The group says at least $85 billion of mortgages could be originated from 375,000 households occupied by undocumented renters, up from an estimated $44 billion from 216,000 households a few years ago.

Providing financial services to illegal immigrants is drawing criticism. Supporters say illegal immigrants contribute to the economy, often pay taxes and can help bring rundown communities back to life. Opponents contend that such lending can be risky because they know little about these borrowers’ ability to repay the loans.

J.P. Morgan’s pilot program, called “Building a Dream,” is generating dissension among some of the bank’s underwriters who are reluctant to handle the loans for fear that they violate federal law by encouraging illegal immigrants to stay in the country, said a person familiar with the situation.

In Maricopa County, which includes the city of Phoenix, the sheriff, whose office has arrested hundreds of illegal immigrants, said banks providing these loans are taking on a risky proposition.

“If I catch these people, they are going back to Mexico and the banks will have a tough time collecting on their loans,” said Sheriff Joseph Arpaio.

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123 Responses to The (illegal) American Dream

  1. James Bednar says:

    From MSN/Money:

    UBS winding up hedge fund after Q1 profits fall

    Swiss bank UBS shocked investors by reporting lower first quarter net profits on Thursday and the closure of its Dillon Read hedge fund arm which was hit by losses in the U.S. subprime mortgage market, sparking a selloff in its shares.

    Dillon Read Capital Management ran up losses of 150 million Swiss francs ($124 million) in the first quarter, becoming the latest casualty of the crisis earlier in this year in the U.S. subprime sector.

  2. James Bednar says:

    From the Wall Street Journal:

    Bond Investors’ Lament
    Fallout as Moody’s, S&P
    Cut Ratings on Issues
    Tied to Subprime Loans
    May 3, 2007; Page C1

    More challenges are hitting bond investors who own securities backed by risky mortgages.

    Over the past two weeks, Moody’s Investors Service cut credit ratings on more than 30 bonds that were issued in 2006 and backed by pools of “subprime” mortgages, home loans made to consumers with troubled or sketchy credit histories. The downgrades came as more borrowers defaulted on their mortgages and caused losses to spike among the pools.

    More than half the bonds that were downgraded were originally rated “investment grade” but were cut to “junk” status, because they now are viewed as much more likely to lose money. A few bonds with weak ratings already have been eroded by losses, which means investors in those bonds probably won’t be repaid.

    “It’s unusual to see downgrades in subprime deals so soon after they were issued,” said Jay Guo, a director of asset-backed securities research at Credit Suisse Group. “This is not a normal phenomenon and is a cause of concern.”

    “It’s embarrassing for a ratings company to downgrade bonds so quickly” after the bonds were issued, said Paul Ullman, chief executive of HFH Group, a New York hedge fund active in the mortgage market. “It reflects poorly on all parties in the underwriting process and their judgment of the credit-worthiness of the bonds.”

    Moody’s Investors Service, a unit of Moody’s Corp., is reviewing 81 bonds for potential downgrade, including a few with double-A and triple-A ratings, where risk was supposed to have been minimal. The ratings company lowered a handful of ratings on 2006 bonds earlier in the year, but the recent series of downgrades and reviews has affected many more bonds and has been more severe.

    Standard & Poor’s, a unit of McGraw-Hill Cos., has downgraded 43 bonds backed by subprime mortgage loans from last year and is reviewing more than 60 for downgrades.

  3. Zac says:

    Thanks everyone for your feedback.
    I was post #122 on yesterdays main thread.
    I just wanted to add that the contract I signed last week was a re-list of my first 3 month contract with them that had just expired. Her boss had 3 months to decide that he did not like the comission rate.
    I gotta go to work now.
    I can read the blog but not post at work.
    Thankyou everyone.

  4. James Bednar says:

    From Bloomberg:

    UBS Profit Falls as Hedge Fund Losses Hurt Bond Fees

    UBS AG, the world’s biggest money manager, reported a third straight decline in quarterly profit and said it plans to scrap the hedge fund run by John Costas after losses in the U.S. mortgage market.

    Dillon Read was “an unbelievable misstep,” said Florian Esterer, who helps manage $49 billion at Swisscanto Asset Management, including UBS shares. “Once UBS agree on a strategy they normally stick to it. There must have been huge problems.”

    UBS started the Dillon Read hedge fund less than two years ago, partly to hang onto Costas, the former investment banking chief. Costas, 50, will help shut down the hedge fund and stay at the bank in an advisory role, Chief Financial Officer Clive Standish said on a conference call with reporters today.

    The losses at the hedge fund were “related to the U.S. mortgage-backed securities market, which was obviously weakened by the U.S. subprime market,” Standish said.

  5. James Bednar says:

    From Bloomberg:

    General Motors Says 1st-Quarter Profit Dropped to $62 Million

    General Motors Corp., the largest U.S. automaker, said first-quarter profit fell to $62 million, a day after the GMAC LLC finance unit reported a loss because of bad mortgages.

    Net income was 11 cents a share, compared with $602 million, or, $1.06, a year earlier, the Detroit-based automaker said today in a statement. Excluding one-time costs, the profit was 17 cents a share, trailing analysts’ projected profit on that basis of 83 cents, the average of 12 estimates compiled by Bloomberg.

    The results were hurt by the $305 million first-quarter loss at GMAC, the auto and home lender that was wholly owned by GM until 2006. GM holds a 49 percent stake after selling the rest to a group led by Cerberus Capital Management LP.

    A “sharp downturn” in the U.S. mortgage market pushed GMAC’s Residential Capital LLC unit to a $905 million loss compared with year-earlier earnings of $201 million, GMAC said. The parent company injected $1 billion in equity into ResCap this year through April to shore up the unit’s cash position.

  6. James Bednar says:

    Posted the weekly inventory numbers late yesterday. I’ll repost here in case anyone missed them:

    Inventory continues to hit the market at a rapid pace. It’s surprising that we saw this level of inventory growth on an ‘expirations’ week.

    GSMLS – The usual counties
    Ber, Ess, Hud, Pas, Mor, Som, Sus, Uni, War

    4/25 – 18,472
    5/2 – 18,766 (1.6% Weekly Increase)

    NJMLS – New Jersey MLS
    Ber, Ess, Hud, Pas

    4/25 – 8,623
    5/2 – 8,763 (1.6% Weekly Increase)

  7. Clotpoll says:

    UBS (5)-

    Oops…looks like UBS had a taste for the crack it was cooking in the back room.

    Dealers aren’t supposed to be users…

  8. Clotpoll says:

    How do you price a MBS in which one of the main default risks is deportation?

    First credit cards…now mortgages. I cannot, for the life of me, understand how any of this is legal.

    I’m not stridently anti-illegal immgrant. It’s hypocritcal to believe all 10,000,000 already here can be rounded up and tossed out. It’s also assured that even if we could, a head of lettuce would cost $7. However, where does the madness stop?

  9. SG says:

    This Loan is not just issue for illegal immigrats, but for folks going thru legal immigration process as well. It took me more than 7 years to get my Green Card through legal Employment based immigration process. (well that included lot of lobbying and organizing to get a law changed or it would have been 30 years+). During all that time, we had our down payment ready, but just always felt too risky to buy a house. I almost had house closed in 1998, but backed out finally, because we were waiting for INS to respond back. The whole legal immigration process is a big sham.

  10. BC Bob says:

    “Dillon Read Capital Management ran up losses of 150 million Swiss francs ($124 million) in the first quarter,”


    Subprime and carry [Feb 27]?

  11. rhymingrealtor says:


    Sorry I did’nt respond to your post yesterday, firstly we still take 4% listings but we do not take 3 month listings, secondly if you had signed a 4% listing w/me and my “boss” wouldn’t allow, I would eat the difference myself, as should your agent.


  12. Clotpoll says:

    BC (11)-

    How’d you like to be paying those guys 2-and-20 to pi$$ away your money?

    It’d be more fun to go to AC and put your money on the pass line.

  13. pesche says:

    this is a sad state of affairs when
    we as a country seem to be folding to
    the illegals.

    NJ has been leading the pack as a welfare state. Have we no Shame?

  14. James Bednar says:

    1) Claim you are illegal, get a TIN.

    2) State your income, borrow as much as possible, leverage and buy the largest house you can.

    3) If the market sours, simply take a vacation in a foreign country, and while you are there just mail the keys back to the bank.

    4) Come back home, rinse and repeat.

    5) Profit!


  15. BC Bob says:

    “How’d you like to be paying those guys 2-and-20 to pi$$ away your money?”


    It’s the greatest gig going. Throw the bats, balls and golf clubs away, be a hedgie. Alarming.

  16. James Bednar says:

    Bergen Co. April sold homes (not all towns).. (PDF Warning)


  17. RentinginNJ says:

    Clash ensues over new cop hires

    Englewood police officers are at odds with the town over staffing levels and salaries.

    Salaries and staffing are at the core of a contentious negotiation between Englewood and its police unions, a microcosm of the problems facing many North Jersey municipalities.

    Police say staffing is inadequate, and more crime could be stopped if there were more officers. But that’s not an option, city officials say, in a department where the median salary is $104,000.

    The disagreements reveal how sensitive the topic of police pay has become in North Jersey, where property taxes are among the highest in the nation.

    On police salaries, Hackensack and Englewood are pretty even, with median pay of $105,000 and $104,000, respectively. Garfield’s median pay is slightly less, at $100,000.

    85% of Englewood police officers are paid more than $100,000 (including overtime)

    Police in Bergen County are the best paid in the state, and New Jersey police are the best paid in the country, according to federal labor statistics. Englewood’s department ranks 46th statewide in average pay.

    The clash in Englewood comes at a critical time: The council has introduced a $53 million budget, and city officials are negotiating with the police unions for the 82-member department.

    A newly hired patrol officer in Englewood starts at only $32,237, but within five years that officer is at $96,054. The base pay for a rank-and-file patrolman in New York City tops out at $60,000 after 5½ years.

    “I don’t understand the pay scale in the suburban communities,” said Betty Grossman, a real estate agent. “All the towns as far as I can see are overpaying, and I don’t see how we can afford it.”

    A beginning Englewood patrol officer is also entitled to the following days off: 20 vacation days, 13 holidays, 15 sick days and one personal day. A revolving schedule means that officers have a three-day weekend every three weeks, for a total of 17 additional days off per year.

    Ranking officers can earn up to 28 vacation days annually.

    O’Keefe said Englewood taxpayers are actually getting a “bargain” when it comes to police coverage. While the $11.2 million police budget is one-fifth of the city’s budget, that’s small compared with the school budget, which is $64 million, O’Keefe points out.

    The Record compared Englewood staffing with two other Bergen County towns with similar crime levels: Hackensack and Garfield. Englewood employs 3.1 cops for every 1,000 people, compared with 2.5 cops for every 1,000 people in Hackensack and 1.9 in Garfield.

    Because of the city’s diverse income levels and different neighborhoods, cops must respond to everything from drug sales to quality-of-life complaints, Pulice said.

    Haberfeld agreed that there is no accepted per capita standard for police staffing, since communities vary so much by crime levels, demographics, tourism and business activity.

    Councilman Gordon Johnson, a former Englewood police officer, said the city can’t do much about current pay scales because they’re determined by contract. But he would support hiring more officers, he said.

    “But as far as an exact number, that’s up to the taxpayer, and how much they’re willing to pay,” said Johnson, also a state assemblyman.

  18. Willow says:

    Here are three identical 3 bedroom ranches with a few small differences in the same neighborhood. Two are active and one sold 11/2006 after being on the market for 126 days. All were listed by the same realtor.

    GSMLS 2285859 is the one that sold for $468,500. This house has an expanded kitchen that was probably remodeled in the 1980s. Otherwise, original bathroom, etc.

    GSMLS 2396293 is on the market for $455,000 which seems reasonable considering the comp right next door. It has been on the market for 20 days.

    GSMLS 2402633 is right around the corner from the other two. The attic has been finished to fit two bedrooms and there are two small dormers in the front. Originally, it had the original kitchen and original bathroom. It was listed under 2336604 for $549,000 and on the market for 143 days. It says in the new listing that they have redone the kitchen (granite, stainless). They have listed it for $519,900 now.

    This perplexes me – the house didn’t sell so they put in a new kitchen and hope to get over $50,000 more than a comparable house for a new kitchen and some drywall on the second floor.

  19. James Bednar says:

    This perplexes me – the house didn’t sell so they put in a new kitchen and hope to get over $50,000 more than a comparable house for a new kitchen and some drywall on the second floor.

    You obviously don’t watch enough HGTV or TLC.


  20. jamey says:

    Peripherally related, but here’s how some clever folks probably qualified for huge loans:

    What chaps my arse is that no assumption is made for the work a father does around the house. My extracurricular job duties include plumbing, carpentry, landscaping, cleaning, cooking, “procurement,” data processing, marketing consutation, copywriting, teaching, etc.

    That oughta be good for at least a quarter-million/annum.

  21. RentinginNJ says:

    Sorry for the length…I thought I cut out more than I really did

  22. t c m says:


    maybe yahoo will pat you on the back around father’s day.

  23. James Bednar says:

    From MarketWatch:

    U.S. initial jobless claims at lowest level since Jan.

    In a sign that the labor market remains tight, U.S. weekly jobless claims fell to their lowest level since early January, the Labor Department said Thursday.

    First time applications for state unemployment benefits fell by 21,000 to 305,000 in the week ending April 28, the department said. This is the lowest level since the week ending Jan. 13.

    The four-week average of new claims dropped 4,500 to 328,750.

    The previous week’s initial claims were revised to 326,000 from 321,000.

    The number of new claims was well below forecast. Analysts had been expecting claims to rebound after a sharp drop in the previous week.

  24. make money says:

    this is a sad state of affairs when
    we as a country seem to be folding to
    the illegals.

    I’ve been saying this all along.

  25. James Bednar says:

    From Bloomberg:

    U.S. Productivity Up, Labor Costs Eased Last Quarter

    .S. worker productivity last quarter grew faster than forecast and labor costs moderated, raising speculation the labor market won’t fuel inflation.

    Productivity, a measure of how much an employee produces for each hour of work, rose at an annual rate of 1.7 percent, compared with a 2.1 percent increase in the fourth quarter, the Labor Department reported today in Washington. Labor costs, adjusted for productivity, rose at a lower-than-forecast 0.6 percent pace after jumping 6.2 percent in the fourth quarter.

    Employers responded to a slowdown in economic growth by shortening the workweek, squeezing out a gain in productivity. The slowdown in labor costs may ease concern companies would have to boost prices and bears out the Federal Reserve’s forecast that inflation will moderate.

    “Given the economy has slowed down as much as it has, It’s an amazing performance,” said Brian Bethune, an economist at Global Insight Inc. in Lexington, Massachusetts. “It’s the kind of thing that would warm the hearts of the Federal Reserve.”

  26. James Bednar says:

    From MarketWatch:

    ISM services index rises to 56%, above expectations

    Businesses in the nonmanufacturing sectors of the economy were growing at a robust pace in April, according to the Institute for Supply Management. The ISM nonmanufacturing index rose to 56% in April from 52.4% in March. Economists were expecting the index to rise to 53.3%. Readings over 50% in the diffusion index mean more firms were growing than were shrinking. The index has been above 50% for 49 straight months. The new orders index rose to 55.5% in April from 53.8% in March. The employment index rose to 51.9% in April from 50.8% in March. The prices-paid index rose to 63.5% in April from 63.3% in March.

  27. JP says:

    I just bought a mattress with THREE YEARS interest free financing. Sub-prime mattress fiasco? He said “What is your income?” I could have told him anything. LOL.

    On the flip side, I got an up-front cash discount for the bed-set furniture. The store was empty

  28. hoodafa says:

    For sale: Scenes From a Bubble

    Wondering how home prices got so high – and why they now have to fall? Here’s the story of what hit you: an amorality play in four acts. Money Magazine reports.

    More at:

  29. dreamtheaterr says:

    Whether you are illegal or a legal immigrant on the way to becoming a US resident, if you are crooked enough in thinking, there is no risk for you.

    Buy as much house as you can for the least monthly payment. If it does not work out, take a one-way ticket back to your country. Before buying your air ticket, make sure you max out your credit card and buy all the latest flat-screens and electronics, and ship them to your home country.

    This whole thing is getting insane….. what’s with these corporations so desperate for business?

  30. chaoticchild says:

    Before buying your air ticket, make sure you max out your credit card and buy all the latest flat-screens and electronics, and ship them to your home country.

    Or sell it on Ebay or to friends and family. I was recently offered this deal, this “guy” can get anything for me 30%.


  31. chaoticchild says:

    I meant 30% off.

  32. Marito says:

    Hey guys, many people here are sounding IMHO as clueless as honest-realtor in a different topic. It’s either that, or I just don’t understand your take on the world.

    First of all, Clot, jb, make money et al. are fuming about some undocumented immigrants getting a mortgage, falling behind in payments and then leaving for a foreign country instead of paying the debt. And what prevents you guys from doing the same? I mean, nobody is going to deny you legal entry into Guatemala, El Salvador, Mexico or any other of those wonderful, developed and peaceful countries were opportunities for work and personal development are plentiful for everybody! I’ve never heard of a blond gringo being extradited for flimsy economical crimes. And I work for the US Attorney’s Office in New York pretty often, so I should know. Put yourselves in others guys’ shoes for a sec: the banks are not acting from the goodness of their hearts, but for profit, they run a risk expecting rewards; same from the undocs who take such mortgages (which I would never advise them to do, specially in Maricopa), owning is more expensive than renting, and they can lose everything if they are deported (unless you guys imagine that they’re somehow taking the home). And please stop it with the stupid shit of the country bending down to illegals? Why don’t you also sing the praise to the liberation of Irak! Damn.

  33. James Bednar says:

    From Marketwatch:

    Fed to consider new rules on abusive lending
    Fed to hold public hearing in June on subprime lending

  34. James Bednar says:

    For those who were generous enough to contribute towards hosting, please note that the move to the new host was completed this morning. Your support is greatly appreciated, not only by me, but by all the readers of this site.


  35. James Bednar says:

    From MarketWatch:

    Fed to consider new rules against abusive lending

    The Federal Reserve will hold a public hearing June 14 to consider adopting new rules to combat abusive lending, especially in the subprime market, the Fed announced Thursday. “The goal is to find ways to promote sustainable homeownership through responsible lending, informed consumer choice, and effective guidance and regulation,” said Fed Gov. Randall S. Kroszner in a statement. The Fed said the hearing would “focus on how it might use its rulemaking authority to address concerns about abusive lending practices in the home mortgage market.” The Fed has authority to issue regulations that cover all lenders, not just banks.

  36. RentinginNJ says:

    Or sell it on Ebay or to friends and family. I was recently offered this deal, this “guy” can get anything for me 30% off.

    I got approached in Circuit City while buying a TV. The guy said he was desperate for cash. He offered to buy the TV with his credit card and I could give him the cash for the TV minus $100 for my troubles.

    I have another friend of a friend who owns a pawnshop that specializes in tools. People go to Home Depot, buy brand new tools with their credit card and then take them to the pawnshop where they get 40 cents on the dollar, just because they are desperate for the cash.

  37. James Bednar says:

    From MarketWatch:

    Schumer bill tightens rules on subprime brokers

    A bill introduced Thursday by Sen. Charles Schumer, D-N.Y., would tighten rules on mortgage brokers and originators and direct $300 million in federal funds to community groups that specialize in foreclosure prevention. The bill sets standards for brokers to assess a borrower’s ability to repay a mortgage and require originators to underwrite loans at the fully indexed rate. The subprime mortgage business caters to poorer borrowers with blemished credit records. Subprime delinquencies have jumped as interest rates have climbed and house prices stopped rising.

  38. Jamey says:

    TCM (23)

    Not bloodly likely, but way to miss seeing the forest through the trees. The presumption is that housework is done by women? That’s insulting to both sexes.

  39. James Bednar says:

    The bill sets standards for brokers to assess a borrower’s ability to repay a mortgage and require originators to underwrite loans at the fully indexed rate.

    Looking for a copy of the bill now. This has the potential to be a major bombshell.


  40. BC Bob says:

    “underwrite loans at the fully indexed rate.”



  41. chicagofinance says:

    Clotpoll Says:
    May 3rd, 2007 at 8:25 am
    BC (11)- How’d you like to be paying those guys 2-and-20 to pi$$ away your money?

    It’d be more fun to go to AC and put your money on the pass line.

    clot: I’d submit that it would be better playing “do not pass” with Reech rolling and a bunch of bad combovers at the table.

  42. dreamtheaterr says:

    Schumy & co. are doing lip service. $300 million is a drop in the bucket…this subprime mess is an inescapable ‘blackhole’ for many.

  43. James Bednar says:

    Still looking for a copy of that bill, can’t seem to find any reference to it on the Senate site, or through THOMAS.


  44. James Bednar says:

    Best I could find was the press release from Chuck’s site.

  45. James Bednar says:

    The Borrower’s Protection Act of 2007:

    1) Establishes a fiduciary duty for mortgage brokers and other non-bank mortgage originators;
    2) Creates a faith and fair dealing standard for all originators
    3) Requires originators to underwrite loans at the fully indexed rate;
    4) Requires originators to create escrow accounts to pay taxes and hazard insurance on subprime loans;
    5) Prohibits steering (i.e. brokers may not direct or counsel a consumer to rates, charges and principal amount or prepayment terms that are not appropriate or suitable for the them); and
    6) Holds lenders responsible for policing their associated appraisers and brokers.
    7) Prohibits originators from influencing appraisal process

    Very interesting indeed.


  46. BC Bob says:

    ………and real estate never goes down in value.

  47. RentL0rd says:

    Marito #34.. very well said!

  48. scribe says:


    I can’t find the text of that bill, either, and the 202 office number is a constant busy.

    Odd that there are no names and phone numbers or even email addresses for his press officers on the web site.

  49. nwbergen says:

    FYI.. For the Geeks on this site Comp USA is going out of business. You can still find some good deals 40% 50% off. Totowa has best the best selection of computers and laptops. Paramus store by Paramus Park Mall is picked clean, the other Paramus store still has some stuff.

  50. Rachel says:

    Last night I rode my bike by a beautiful Victorian with a for sale sign out front. It’s MLS # 2333955 on Perry Street in Morristown. It is currently listed for $799k reduced from $924K. The owners purchased in June 2002 for $775K. A $16K loss factoring in real estate transaction fees after almost 5 years!

  51. BC Bob says:


    Hey Chuck, can we please rebuild New Orleans first?

  52. UnRealtor says:

    “First of all, Clot, jb, make money et al. are fuming about some undocumented immigrants…”

    Please don’t confuse illegal aliens with “immigrants.”

    “Immigrants” are foreign nationals who respect the laws and sovereignty of the United States, apply for citizenship at their local consulate, and wait in line behind all the other applicants who have applied for US citizenship before them.

    Illegal aliens are foreign nationals who are in the United States illegally, do not respect the laws of the United States, and are not subject to the protections afforded US citizens.

    “I’ve never heard of a blond gringo being extradited for flimsy economical crimes.”

    That’s because in Mexico, for example, you don’t need to commit a “flimsy economical crime” — you are deported immediately because you are a foreign national in their country illegally.

    The whole attempt by many to blur illegal aliens with “immigrants” and “race” protections is really a pathetic red herring designed to obfuscate reality.

  53. UnRealtor says:


  54. UnRealtor says:

    Post #54 “awaiting moderation”…

  55. scribe says:


    I got through to Schumer’s office by calling the capitol switchboard.

    The person who answered the phone thinks the bill hasn’t been introduced yet. She put me though to someone who works on housing, and I left a voicemail.

  56. Frank says:

    Illegals are getting mortgages with stolen SSN, so how different is this? Guess who’s defaulting on their first payments?

  57. bergenbubbleburst says:

    #54 The border between Mexico and Guatamala is one of the most tightly controlled borders in the world. Illegals from Guatamala into Mexico are immediately deported, period.

    So it is OK for Mexico to deport illegals from their country, but not right when we do it? Seems like a double standard.

    The question Mexcians need to ask is how come after being independent for almost as long as the US, they still cannot provide for their own people?

  58. Al says:

    TO Some people here who says that nothing stops americans from leaving the country and going to mexico:

    1. 3rd world countries Including Mexico have one of the stricter rules about immigration.

    2. If you are there illegally and caught – you will be sunjected to prison time and torture – and tehre will be no crap about human rights and equiality.

    3. You can not get medical help in there if you are in teh country illigally – in US we have law’s according to which if it is an emergency or life threatening situation Hospital have to give a person medical care.

    3. Your kids do not become citizens just because they are born on teh Mexico turf (this law is only in USA!!!)…

    4. If in any other country ilegal immigrants will go on the strike and revolt – they will get shot at, imprisoned and deported – not assigned a day to go and protest.

    Finally – illegal immigrants are destructive to many communities as they do nto pay their share of TAXES/ and have no identities – get away with various crimes.

    I am not saying that all of them are evil, but the whole situation leaves possibility for abuse fro al possible angles –
    abuse by illigal immigrants

    as well as abuse of illegal immirgrants.

    There are plenty of decent folk here in US who would be happy to work, earn their minimum wage and pay taxes and stuff…..

    I have no problem of giving them work permit, and documentation. After 10-15 years there is no problem with them becoming citizens.

    However the problem with giving mortgages to illigal immigrants is that the taxpayer will end up paying for non-performing loans. If this loans would fairly price risks involved illigal immigrants woul not being able to afford this loans:

    Think about it – what % promised return would you need to make you give illegal immigrant a loan????

  59. fanshawe says:

    Somewhat related to #54:

    About a month or two ago in the Economist, there was a little blurb about how some activists are protesting a national US ID card because it would “unfairly target illegal aliens”.

    Say what, now? I haven’t really thought enough about a national ID card to say whether I’m for or against it, but saying the national ID unfairly targets illegal aliens is like saying murder laws unfairly target murderers.

  60. RentL0rd says:

    UnRealtor #54 –

    I disagree with the use of the word “illegal”. I prefer the term undocumented.. here’s why –
    A person could be on an employment based visa for many years in the US. Yet, if the employer fires the immigrant, he/she is immediately considered out of status and therefore illegal with no recourse.

    So, for instance if you were working on a visa in the US, and the company fires (or goes bankrupt or whatever), you are illegal even for the few days you may be in between legal jobs.

  61. RentL0rd says:

    i’m in moderation? is illegal a bad word or is it “undocumented”?

  62. RentL0rd says:

    JB, the website is so fast that my comment just disappeared.

  63. RentL0rd says:

    looks like the word “i11egal” puts you in moderation

  64. BC Bob says:

    “In what Reuters describes as its “sternest warning to date” on the state of the hedge-fund business, the New York Federal Reserve said Wednesday that the funds could represent the biggest risk for a financial crisis since 1998, when the implosion of Long-Term Capital Management threatened global markets.”

  65. Al says:

    Some good information on links and immigration Law and rules in Mexico.

  66. Happy Camper says:

    What about dealing with the source of the problem? Well, we don’t do that in America. Not with drugds, not with migration.

    What about heavy fines on employers that hire somebody not properly documented? Out of the question.

  67. James Bednar says:

    From MSNBC:

    New Century to lay off 2,000 workers

    Financially strapped subprime mortgage lender New Century Financial Corp., failed to receive any bids for its mortgage loan origination business, forcing it to shut down the unit and lay off around 2,000 employees, the company told employees Thursday.

    The Irvine-based company, which has been preparing to sell off its assets under Chapter 11 bankruptcy protection since last month, notified employees during a conference call that they would be laid off effective Friday.

  68. tcm says:


    #40 – oh please, stop pandering

  69. gary says:

    I want to know one thing: Is Suzanne still doing research?

  70. James Bednar says:

    From MarketWatch:

    House committee votes to make more housing loans available

    In a move aimed at heading off more problems in the subprime mortgage market, the House Financial Services Committee approved a bill Thursday that increases federal loan limits in high-cost areas of the country and authorizes lower down payments for borrowers. The bill, co-sponsored by Reps. Barney Frank, D-Mass., and Maxine Waters, D-Calif., also directs the Federal Housing Administration to extend credit to borrowers with higher credit risk than the government currently serves. The bill also contains a provision to put FHA surpluses into an affordable housing fund. Some Republicans objected to the measure. To become law the full House and Senate would need to approve the bill and the president would need to sign it.

  71. Domi says:

    This caught me by surprise!
    Masachusetts has delayed the foreclosure process by 60 to 90 days.

    Here’s the article

  72. RentL0rd says:

    Lou Dobbs is the jerry springer of immigration.

    If you are in the passenger seat, not buckled up, and pulled up by the police (or in an accident) – Who’s at fault? you are the driver? Both?

    IMHO it should be both – the border security and the guy who sneaked in.

  73. Richard says:

    to even hint of a comparison between lou dobbs and jerry springer is laughable. lou is a great american and one of the few that actually seems to care about what’s happening to the middle class and this country. companies love the illegal cheap labor as it benefits them directly while the taxpayers foot the cost. politicians won’t touch the issue because corporations have them in their back pockets and it’s good for keeping wages and the masses in check.

    the whole thing would be one big joke if not for the seriousness of it.

  74. RentL0rd says:

    Richard, just fyi – you are the one who’s laughed at here!

  75. rhymingrealtor says:


    Suzanne is no longer researching -she is doing motivational speaking, I know as I was there today as part of my “Continuel Ed” ahem..


  76. Paul says:

    J. Bednar,

    A while back you had an article by a Mike Whitney full of doom and gloom. For some reason you took it off. I looked on your site and can’t find the reason.

    I’ve been reading Whitney’s stuff on and find his pessimistic view interesting if a bit extreme. What was the reason you took it off? I’d especially like to know if it’s because of some dishonesty in his stats or something like that. There’s too much info out there and there’s no point wasting time on someone who doesn’t cite the facts correctly. Thanks.

  77. honest-realtor says:

    I have been called troll(rated very high), joke, stupid etc and have even been told to “go away”. why do you have so much hatred to somebody having a different opinion? Is this the heaven of bigotry? what happen to our constitutional right of free speech? if you don’t agree with my take on the market, feel free to present your arguments. Kids, be a little more open-minded and we are here to help you find a house. Now is truly a great time to buy….. If you look long term, real estate is a great investment.

  78. James Bednar says:

    From Reuters:

    KPMG quits New Century, investigation expands

    KPMG has quit as auditor of bankrupt subprime lender New Century Financial Corp. (NEWC.PK: Quote, Profile, Research, which has hired forensic accountants to investigate how the company valued its stake in mortgage-backed bonds.

    KPMG notified New Century last week that its client-auditor relationship had ceased, the subprime lender said on Thursday in a regulatory filing.

    New Century said it has expanded its internal accounting investigation, at the request of KPMG. to look at how the company valued its stake in mortgage-backed securities in 2006 and prior periods.

    The company’s audit committee has retained independent counsel, forensic accountants and other professionals to assist it in connection with the internal investigation.

  79. BC Bob says:

    “if you don’t agree with my take on the market, feel free to present your arguments”

    No problem.

    The lunacy, fraud, misrepresentations, distortions and deceit resulted in propelling this market to new heights. Then out of the blue, the market stalls and begins to self destruct. Now the spigots are turned off and the market will retrace, based on its underlying fundamentals. Unfortunately, there has been so much structural damage,it will takes years of lower prices to recoil to its core.

    Are you kidding? You want us to present our arguments? Sit down and get comfortable and go back to the archives. We have been discussing this for over a year. I’ll make it easy, simple question, how are 80-100% price gains supported when incomes grew at 8-15% during the same time period, real incomes, close to flat?

    Troll? I’ll never say that. I appreciate all that you and your cohorts have done for me. I’m eternally grateful. Unfortunately, I can not say the same for those that got sucked into this charade.

  80. gary says:


    I’ll miss Suzanne… (sniff…).

  81. Think it through says:

    Three questions for you HR:

    1) Why the need to call yourself honest realtor?

    2) How long do you define “long term” as used in the last sentence of post 83?

    3) Was there ever a time when when it was NOT great time to buy?

  82. MJ says:

    “Now is truly a great time to buy” HA HA HA HA!
    when did you last buy?

  83. still_looking says:

    #60 item 3.

    And not only are you obligated to take care of them in emergencies and for severe traumas as well as for (expensive!!) transplants… They also retain the right to give false names addresses and phone numbers, to NOT pay you for caring for them medically and last? They can sue you.

    Just my bitter and jaded view of non legitimate “citizens.”

    We engage in russian roulette every time an undocumented comes to our ER.


  84. still_looking says:

    sigh..moderation….in moderation.

  85. Frank says:

    Can you send your post to your congressman and senators? They’re the one that will make a difference, we are just a bunch of blogger.

  86. Frank says:

    “Despite making only $14,000 a year, strawberry picker Alberto Ramirez managed to buy his own slice of the American Dream. But his Hollister home came with a hefty price tag, $720,000. A year and a half later, Ramirez has defaulted on his loan, and he’s hoping to sell the house before it’s repossessed.”
    This is what America is all about, anyone can do it.

  87. BC Bob says:

    Cold weather, new high temps in Dec, floods, maybe a drought, etc… Speaking of cold weather, possibly amnesia, has the Super Bowl been played? Is the new barometer for the spring selling season, the Grey Cup? Clot, are the odds available?

  88. bergebbubbleburst says:

    #85 BC Bob: She has no idea what you are talking about. With all due respect, she can barely string a sentence together.

  89. dishonest-realtor says:

    Give me all your money.

    Don’t worry, I am a fidoucheiary.


  90. bergebbubbleburst says:

    #83 Honest: WIth all due respect you have no take on the market. You have been sppon fed information, that you are simply reading off a sheet, provide by your broker.

    Its easy, this was a real estate bubble, the prices were not supported by the underlying economic fundamentals. It is as simpel as that.

    Ypur local community college can offer you a range of choices on economic, finance and accounting courses, if you would care to avail yourself of them.

    Please so nto insult us with you are here to help us nonsense.

  91. Aaron says:

    push me pull me…
    yeah illegals help keep the price of lettuce down and increase industry profits, but we pay for it through higher health costs. All that charity care gets passed on to consumers.

  92. Contractor Bill says:

    I can’t imagine illegals sending all that cash in the mail every month?

  93. Think it through says:

    Industry profits through lower labor costs but everyone else must bear the social costs.

    And health care costs are only a part of this equation.

    Nice, huh?

  94. honest-realtor says:

    burgenBubble, how did you mom teach you to speak? Was she not available when you grew up? If that is true, I will forgive you.

    But I think you should go through anger management course.

    If you missed the previous opportunity and has been priced out, I can help you find a house now. You shouldn’t be obtuse enough to miss this one, should you?

  95. chicagofinance says:

    KL / clot: I apologize.

  96. Jay says:

    I belive that the issue of issue of illegal immigration is not simple. An honest and hard working person should not be punished just because he came here what a faulty law considers “illegally”, it is that law that needs to be changed, (You might recall that a Rosa Park also broke a “law” by refusing to give her seat).
    The fake borders created between people by the politicians all over the world are nothing but just political boundaries to curb free human spirit. We should not give more importance to these borders than what they deserve and if they are harming honest and hard working people they deserved to be scrapped.

    People try to link terrorism with illegal immigrants but remember the biggest terrorist attack on this country before 9/11 was done by a citizen and we did not and should not have stopped movement of citizens from one state to another.
    Communists tried to control human spirit and they failed.


  97. New In Town says:

    [103] Even thought this is an obvious troll, I will respond since this is a widely held ‘closet’ position.

    It is not possible, even if it was desirable, for the economy to absorb the results of an open border. If it could absorb the influx now, there would not be hiring zones where the unemployed gather to hope for day work.

    It is always a good idea to watch out what you ask for, since you just might get it.

  98. honest-realtor says:

    when your parents,grandparents and grand-grand parents(….) came here on May flower, did they get the visa from Indians? NO!! so they were illegals too, right? they killed a lot of indians. So they are terrorists?

    Come on, people. Don’t be so cruel on mexicans. They want to live a better life, just like us.

    Be humane!

  99. LB says:

    honest… this is all a shtick, right?

    I hope you’re doing something to cover your tracks as to where you’re doing your posting from. If not, I’m sure at least one person (ahem, jb) is having a good laugh knowing who you are (or might be), based on your IP address.

    If, however, this is all genuine…wow, you’re one unique individual.

  100. Pat says:

    honest-realtor, if you truly want to help people, I know a great place for you to post.

    I’m one of those obtuse folks you’ll never be able to get through to, simply because I’m so attached to my break-even calculators. But I know some folks who’d probably be willing to hear your pitch.

    There’s a link up on the side of the home page here. The link is There are a couple of posters over there who need some help with their attitudes, just like bergenbubble. I KNOW you can do it.

    Why don’t you go on over there and give a shout out for Txchick, Neil or Stucco and tell them you can help them if they’ll just look at the big picture for a moment.

    Then really give them all you’ve got.

    Good luck.

  101. Talkhard says:

    Have we lost our minds? What in the heck is going on in this country? We don’t just allow people to cross our borders illegally, we offer them credit cards and home loans and driver’s licenses, and do our best to make them feel welcome. The rest of the world must be laughing their heads off.

  102. Marito says:

    Why do you guys pay taxes?

    A. To have police
    B. To have firefighters
    C. To have social security benefits
    D. To have public schools
    E. To have welfare
    F. To have paved and un-tolled roads
    G. To have public medical assistance
    H. other reasons?

    If you’re in the country without legal documents, you won’t have C or E. Your american-born children will have the right to E, but in many occasions you won’t apply for it in their behalf for fear of running into A. Of course you won’t spontaneously call A if you have a problem. Meanwhile, due to legislation recently passed in many places, and due to the actions of misguided civil watchdog groups, the services provided in D and G are also becoming more difficult and risky to access. B of course you have to call in case of fire; otherwise, the fire may pass into the neighbouring houses of americans!
    Moreover, 3 million out of the 12 million of you, regardless of the fact that you get only a fraction of the intended benefits, have applied for an ITIN and pay taxes. How are you going to collect on your SS benefits without a SS number. Oh, nevermind!

    To think that the damage the country suffers from having illegals out weights the benefits that it gets from them is ludicrous.

  103. Think it through says:

    Come on, people. Don’t be so cruel on mexicans. They want to live a better life, just like us.

    the mexican disdain for academic exertion (don’t believe me? check which group has the highest high school drop out rate) and tendency to cocoon themselves in their mono-linguistic communities almost guarantees that they remain an underclass for many generations.

    One hundred years ago, the uneducated and untrained were a big part of the work force. Now they are relegated to menial labor.

    I think the USA is making a huge mistake by importing poverty in such huge quantities.

  104. RentL0rd says:

    #108 says – we offer them credit cards and home loans and driver’s licenses..

    I have a question. NJ has a 3 point verification system to grant drivers license. They will not even just accept my ‘other’ state license to give me an NJ license. They are also very picky on seeing only original documents. I heard this was put in place after 9/11. The question is, how are undocumented workers getting drivers license?

  105. RentL0rd says:

    #108 says – we offer them credit cards and home loans and driver’s licenses..

    I have a question. NJ has a 3 point verification system to grant drivers license. They will not even just accept my ‘other’ state license to give me an NJ license. They are also very picky on seeing only original documents. I heard this was put in place after 9/11. The question is, how are undocumented workers getting drivers license?

    [looks like the dog ate my post.. using the back button to post again]

  106. RentL0rd says:

    jb, my post (actually two) just vaporized into nothing!

  107. RentL0rd says:

    WTF?! Why are my posts being moderated?

  108. RentL0rd says:

    I’m unrelentingly posting again –

    I have a question. NJ has a 3 point verification system to grant drivers license. They will not even just accept my ‘other’ state license to give me an NJ license. They are also very picky on seeing only original documents. I heard this was put in place after 9/11. The question is, how are und0c0m3nt3d workers getting drivers license?

    [checking if i’m smart enough to beat JB’s filters]

  109. RentL0rd says:

    JB, you should turn off any funky caching you may have put on the webserver.. it’s frustrating

  110. abamitphd says:


    You might want to link to this presentation I attended today:

    Where Did the Risk Go?

    How Misapplied Bond Ratings Cause Mortgage Backed Securities and Collateralized Debt Obligation Market Disruptions

    Here is the link to the paper.

  111. commanderbobnj says:

    #109— Think it through— says:

    “,,,the mexican disdain for academic exertion (don’t believe me? check which group has the highest high school drop out rate) and tendency to cocoon themselves in their mono-linguistic communities almost guarantees that they remain an underclass for many generations….

    ;;;One hundred years ago, the uneducated and untrained were a big part of the work force. Now they are relegated to menial labor.;;;

    ;;;I think the USA is making a huge mistake by importing poverty in such huge quantities;;;”


    For some reason people here on this Blog think that we HAVE TO “take-in” the millions of people from countries that cannot feed nor employe their surplus population

    —–some day take a ride up to Haverstraw NY and see what “imported poverty” has done to what was once a peaceful and quaint village…

  112. afe says:

    This may have been posted before, but I just took this roller coaster ride…wow..unrealtor this one is for you.


  113. Al says:

    Frank Says:
    May 3rd, 2007 at 8:31 pm
    Can you send your post to your congressman and senators? They’re the one that will make a difference, we are just a bunch of blogger.

    Actually I have send letters to 3 congressmans – as I have moved quite a bit. I got two very pretty paper letters replies and was completelly ignored (so far by NJ congressman) – I think paper letters are harder to process, anms therefore take longer.

    My letters are not about housing or other crap – they are about something whoch is a lot more bothersome:

    I am losing all faith in US legal and goverment system and more importantly in US people.

    As I see deliberate and very focused campaign in turning average americans in chewing and thoughtless cow herd. Easy to control and tell them what to do as long as they have bare minimum – enough food not to be hungry and place to sleep – protection from elements(does not have to be nice or a house – even a shared room will do).

    I work with very highly educated people – the lowest level we have on stuff are B.S., tons of PhD’s and Law, MBA’s.
    However noone ever discusses politics. The only one person who is always interested is one of the old-timers – he’s is almost 70.

    Every middle aged person complaind about proprty taxes, agrees that illegal immigration is a problems, agrees that polititians are all croocks but says “what can I do about it? It is too depressing…”

    I think for the past 30 years US had too good of a life and without “THE ENEMY” life got “too good”.

    I do not believe in centralized and organized conspiracy, however I do believe that people are ignorant and lazy and they do not want to move a finger extra if they do not have to.

    Right now we still have a relativelly fair society with low barriers to move between income levels and classes. However the wealth gap is widening, and elinination of middle class will serve the only one purpose – two protect rich people from more competition.

    If everybody who does not like illegal immigration would go on the streets last year – just like those illegals did – there would be a 200,000,000 crowd – how many were there may be 100,000???

    Ignorance is what killing america. Not immigrants, not housing bubble, not even terrorists.

    Too depressing – some funny stuff:

    I went to protest mexican demonstration that day last year, there were probably about 100,000 of mexicans protesting in my city and may be 5000 on american side.

    By the way: why were they waving mexican flags – are we at war with mexico?? Or they want US to become part of mexico??

    On the funny note – I on the way home I got rear-ended by 18-year old hispanic driver who was very exited and instead of driving and keeping his attention on the road he was screaming something out of his windown at people walking home from demonstration.

    As he was not paying any attention to the road, he pushed my car into 5 cars total, and was established 100% at fault for all damage.

    I am glad he had car insurance. I am glad we had car insurance. I am glad, all people involved were wearing seat belts. But what a whiplash we got next day – coughing was the worst!!!!!!!

    However, I do not envy his insurance bill next year. Sorry for sharing this I though it was quite ironic.

    Believe it or not but it is 100% true story.

  114. vinco says:

    When my father-in-law came to the U.S. (legally) in the mid 50’s he wrote back to his family in Europe stating that money was God in the States. Money was first everything else did’nt really matter. It’s always all about money.

  115. yasmin says:

    Hello and congratulations! notem671

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