FICO scores, work permit horrors coming. Not a great time to be an immigrant in the Trump era

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NEW YORK – Beware of filing for bankruptcy or that terrible habit of not paying your credit card on time, if you are an immigrant in the United States, hoping to get a Green Card someday. Big Brother watching you is passé. It’s the era of the Trump administration poking through your financials, digging up dirt from your credit history, that should give you the chills.

The new Public Charge rule which will come into effect from October 15^th, will see a seismic shift in immigration to the US, with laws that favor rich immigrants with stellar financial track record, and disown poor immigrants.

Remember that line by the character played by Cuba Gooding Jr. from the film Jerry Maguire, ‘Show me the money!’ That’s what the folks at Department of Homeland Security will ask for, before issuing a Green Card.

In an 800-plus-page rule released this week to bring in the Public Charge rule, the Trump administration made one thing clear: they will decide on the merits of a case for permanent residency by also looking at the individual’s credit history.

Apart from determining if one used public benefits like food stamps, Medicaid, or housing vouchers, the rules say a low credit score or “negative credit history” in the US could indicate “that a person’s financial status is weak and that he or she may not be self-sufficient.”

The Wall Street Journal reported on Friday that lenders have used credit reports and scores for decades to help determine whether to approve consumers for loans. Employers, insurers and others also have factored in credit information when deciding whether to hire or extend services. But those in the credit-reporting industry said they can’t recall another time where credit reports affected US immigration applications.

The Department of Homeland Security pointed to the agency’s previous comments on the rule when asked about the change: “Self-reliance, industriousness, and perseverance laid the foundation of our nation and have defined generations of hardworking immigrants seeking opportunity in the United States.”

Chi Chi Wu, staff attorney at the National Consumer Law Center, a nonprofit consumer-advocacy group, told the Journal the change is “an absurd idea.” Credit scores, she said, are designed to predict whether someone will default on a loan, not to determine their immigration status.

The rule indicates that a prospective immigrant would have to obtain their own credit report to submit to the government: “DHS notes that an applicant may obtain a credit report for free, but in its estimates DHS assumed that applicants would pay for the report.”

In most other situations where a company or agency wants a consumer’s credit history, the organization—not the consumer—directly obtains and pays for the reports and scores from the credit reporting companies.

Add this new financial stress and burden, on top of the thousands of dollars that go annually in lawyers’ fees, updating work permits and health records, to name a few hurdles for immigrants on track for a Green Card.

The Journal reported the government says it won’t penalize people who don’t have a US credit history. But it says it might give “positive weight” to those who provide records showing they pay their bills on time and have little debt. The government also says it will generally look favorably at those with a credit score “characterized as ’good’ or better.”

The average FICO score among U.S. consumers hit a record high of 704 in 2018 according to Fair Isaac Corp., the score’s creator, reported the Journal. The scale taps out at 850.

Immigration attorney Emily Neumann, a partner in the law firm of Reddy & Neumann, P.C, points out in her blog this week on the new Public Charge rule, that immigrants in the pipeline for a Green Card should possess household income, assets, and resources of at least 250% of the Federal Poverty Guidelines according to household size. For a family of four, this would be $64,374 under the current guidelines.

Immigrants would also need to maintain private health insurance appropriate for the expected period of admission, so long as one does not receive subsidies in the form of premium tax credits under the Patient Protection and Affordable Care Act to pay for such health insurance.

There’s no doubt that for skilled immigrants with a good paying job, the new rules in the offing won’t be bothersome at all. They would in fact be hopeful of their applications getting expedited by this.

However, it’s a strange new world full of trepidations for immigrants in the Trump era.

The new rule come at a time when around 100,000 H-4 visa holders – most of them from India – could lose their work permit soon, which would see their family income dwindle, and take a huge hit.

With talk of recession growing stronger, there will be plenty of palpitations for H-1B visa workers working in companies vulnerable to downsizing. With their spouse also likely to lose work permit, and that Green Card priority date nowhere in sight, they would be having sleepless nights thinking of the danger of going from prosperity to poverty within a day’s time. Or worse, the prospect of having to pack bags to head back home.

The frustration for most immigrants would also be the dim prospects of immigration reforms happening anytime soon, with the per country cap on Green Card bills still stuck in Congress, with wrangling by Senators on Capitol Hill over its merits.

For now, keep paying those bills on time.

(Sujeet Rajan is Executive Editor, Parikh Worldwide Media. Email him: sujeet@newsindiatimes.com Follow him on Twitter @SujeetRajan1)