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Immigrants get sucked into U.S. nightmare of debt
The immigration reform measure that Congress is now debating would require illegal aliens to pay $5,000 in fines, plus thousands more in fees and back taxes.
Banks love this, because the illegals will fall prey to them.
Many immigrants work low-wage jobs, and have no assets. They must borrow from loan sharks. That opens the door to violent crime.
In some cases, employers could offer to pay employees’ fines in return for repayment arrangements, leading to indentured servitude.
It is not clear how much time the immigrants would have to pay the fines and fees and eventually obtain a green card. Because of the backlog of green card applications, immigrants may have up to eight years to come up with the money.
“It’s a lot, but if they gave us the opportunity, we’ll try to get it,” said a young immigrant mother of a 2-year-old U.S.-born daughter, speaking on condition of anonymity for fear of deportation. She makes minimum wage at a Mexican grocery in Georgia, and has no idea how she would get the money for a green card — which could amount to $3,000 for the initial visa application, plus $4,000 in fees, plus back taxes.
To make it across the border, many illegals pay thousands of dollars to smugglers, who threaten to kill them if the illegals don’t pay back the money. Then, many illegals make low wages working in agriculture, construction and the hotel and restaurant industry. Out of that, they often send money back home to support their families. Because they are illegal, they distrust banks.
“If you have a family of four or five, it’s going to add up to thousands of dollars. No one has that much stored in a shoebox. Thus, predatory lenders will devise exploitative schemes, full of usury,” said Robert Moser, deputy director of Catholic Charities for the Diocese of San Diego.
About half of Hispanic immigrants have no checking or savings accounts. Those who have credit cards often pay exorbitant fees to banks. They don’t understand the fine print, and so they are never able to pay off their debts.
When in need of large sums of cash for emergencies or major purchases, they often turn to friends, family, or loan sharks. Many immigrants go to predatory lenders that charge as much as 300-percent interest on short-term loans.
“Every day you see people victimized,” said Guillermo Zuniga of Banuestra, a metro Atlanta financial services company that serves about 20,000 Hispanic immigrants. The company is trying to develop a loan program for some of its customers who might need to pay the fees should the “reform” pass in Congress.
Even if illegals have the cash to pay back a loan, money transfer offices tack on exorbitant fees. The complexity of the proposed process could also drive many applicants to get scammed while they seek assistance with the paperwork.
“They won’t just go to predatory lenders; they’ll go to predatory service providers,” said Donald Kerwin, executive director of the Catholic Legal Immigration Network.
After amnesty legislation passed in 1986, storefront “immigration specialists” promised to expedite the legal process for retainers of up to $3,000. Then they vanished with the cash.
ENTER THE BANKS
“The financial institutions are really excited about this, as it's probably the single largest untapped market” in the United States, said (Jewish) banking consultant Rick Fischer of the San Francisco-based firm Morrison & Forester.
If an immigrant has no traditional credit report, banks may look at his rent and bill-paying history as a way of determining whether the customer can repay a loan, Fischer said.
Many illegals will have to work two and three jobs, if they can find such jobs. They’ll have to cut their expenses, such as the money they send back home.
Still, they are determined to get a green card.
(Unfortunately they will face more and more obstacles that will keep them in debt forever. Meanwhile the banks will get even richer, while the rest of us lose our jobs. -- AZ)