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A group of Democrats says the Trump administration enacted a new policy that bars DACA recipients from receiving federally-backed mortgage loans and then hid the policy from Congress.
The 13 Senate and 32 House Democrats made the claims in a letter sent Monday to the U.S. Department of Housing and Urban Development Inspector General Rae Oliver Davis, in which they requested an investigation into the matter.
“We are concerned that HUD imposed a new, nonpublic, and legally erroneous policy prohibiting the issuance of FHA-insurance loans to Deferred Action for Childhood Arrivals (DACA) recipients and knowingly misrepresented to Congress the implementation and enforcement of this new policy,” the lawmakers wrote.
DACA provides deferred action on removal, work authorization and lawful presence to undocumented immigrants who were brought to the U.S. as children. The immigration policy protects these young people from deportation and allows them to remain in the U.S. and work here. The Trump administration announced the program’s termination in September 2017, which the Democratic lawmakers said “prompted a series of questions” about whether DACA recipients would continue to be eligible for FHA loans.
“ ‘We are concerned that HUD imposed a new, nonpublic, and legally erroneous policy prohibiting the issuance of FHA-insurance loans to Deferred Action for Childhood Arrivals (DACA) recipients and knowingly misrepresented to Congress the implementation and enforcement of this new policy.’ ”
In 2018, Buzzfeed News and real-estate industry outlet HousingWire reported that DACA recipients, also known as Dreamers, were being denied mortgages backed by the Federal Housing Administration, and lenders reported they were making these decisions based on guidance from HUD officials.
Last year, HUD initially told lenders that they were not denying mortgages to Dreamers, HousingWire reported, a claim HUD Secretary Ben Carson and other HUD officials repeated during congressional hearings and in meetings with members of Congress.
But later in the year, HUD Assistant Secretary for Congressional and Intergovernmental Relations Len Wolfson told Rep. Pete Aguilar, a Democrat from California, that Dreamers were not eligible for FHA mortgages.
“ In 2019, HUD initially told lenders that they were not denying FHA loans to DACA recipients, but later told a lawmaker that the policy had changed. ”
Documents obtained through a Freedom of Information Act request by the nonprofit and non-partisan policy research organization Democracy Forward show that HUD officials told lenders not to approve FHA loans for DACA recipients as early as 2018. Among these documents were internal communications that show HUD had reinterpreted a requirement that FHA applicants have “lawful residency” in a manner that excluded Dreamers.
In their letter to HUD’s inspector general, the Democratic lawmakers said the policy change may have violated the Administrative Procedure Act because officials did not provide notice of the change or accept public comment on the new rule.
In a Senate hearing Tuesday, Carson said he had “concealed nothing at all” when it came to a purported policy change, in response to a question from Sen. Bob Menendez, one of the Democrats calling for the investigation. Carson later said that he would cooperate with the investigation and would work with lawmakers to look into the rule.
Menendez said that the department “made a choice to exclude the rules.”
HUD and the Office for the Inspector General of HUD did not immediately return requests for comment.
