Michael Zimmerman of Mortgage Guarantee Insurance Corp., which insured about 1,000 taxpayer identification loans from 2004 to 2007, said the organization stopped insuring such loans last year because of a lack of demand by lenders.
He said Mortgage Guarantee Insurance is continuing to insure existing loans, which have performed well.
Zimmerman, senior vice president of investor relations, said the company did not do any automatic underwriting but instead relied on rent receipts, pay stubs and tax returns to make sure buyers were able to afford the homes.
Bruce Dorpalen of Acorn Housing said he has seen few foreclosures among undocumented home buyers enrolled in the Citibank program.
He said many buyers own their own businesses, have U.S.-born children and have money saved. If they do get into financial trouble, he said, many have an extended family safety net.
"If someone lost a job, there would be other people stepping in to help find a job or make the payments," he said.
USC professor Dowell Myers, who has studied housing trends among immigrants, said they are an increasingly important part of the housing market, in Los Angeles and around the nation, especially as baby boomers start to sell off. The banks have realized that and have reached out to immigrants, despite their legal status.
"They are judging them based on their character," he said.
"Based on the success of the ITIN mortgage, apparently they are making a good bet."
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anna.gorman@latimes.com
