When will we ever learn?

I spotted this sign today in the window of a real estate office at the corner of Kimball and Dundee.

It is in Spanish. It says, "Buy with ITIN. 2% enrollment"

Actually "enganche" literally means "hook" which is perhaps more accurate. It is like paying points to qualify for the program.

What is ITIN? It stands for Individual Taxpayer Identification Number. ITIN is an IRS program specifically for people who should be paying taxes but do not have a Social Security Number.

If you've ever read the 1040 instructions, you are supposed to pay taxes on income you earn as a drug dealer, prostitute, or bank robber. So, everyone who comes into money in the United States is supposed to pay taxes on their income. ITIN makes sure no one has an excuse.

But the IRS also warns that, "ITINs are for federal tax reporting only, and are not intended to serve any other purpose. An ITIN does not authorize work in the U.S. or provide eligibility for Social Security benefits or the Earned Income Tax Credit. ITINs are not valid identification outside the tax system." Here's the link: http://www.irs.gov/individuals/article/0,,id=96287,00.html#what

So, here in Elgin we have a realtor who is encouraging people to purchase a home even though they don't have a Social Security card.

Banco Popular suspended loans to ITIN holders last October.

At about the same time Mortgage Guarantee Insurance Corp. announced that they would no longer insure ITIN loans.

Just so you know, The Illinois State Government proudly supported ITIN borrowers under their I-Loan program. To quote them directly the Illinois Housing Development Authority "will not differentiate between an Individual Taxpayer Identification Number and a Social Security Number. We feel immigration status is an issue for the INS, the FBI, the Department of Homeland Security and other federal agencies that police these issues. Our concern is with the health and safety and housing needs of Illinois' residents. If a family is active in a community, works in a community and pays taxes in a community for three years, they should not be discriminated against."

It is a little difficult to tell if Illinois still holds to that position.

So, I'm not sure if Great Homes Realty has an old sign or if they continue to sell to illegal aliens.
This risky behavior is only one example of a mortgage market run amok and cheered on by realtors, bankers, lawyers and builders...and sadly backed by the "full faith and credit of the United States Government."

I wonder if they've ever read the IRS document on the uses of an ITIN?