Trump’s May 19 Order Pulls Immigration Into Credit Underwriting

President Trump signed an executive order directing regulators to provide guidance on how lenders should consider immigration status — including the risk of deportation — in underwriting and credit decisions, according to American Banker.

The executive order, “Restoring Integrity to America’s Financial System,” was signed on May 19, and builds on an earlier policy change that received far less attention.

In January 2026, the Consumer Financial Protection Bureau (CFPB) and the Department of Justice (DOJ) formally withdrew guidance discouraging lenders from considering immigration status in credit decisions under the Equal Credit Opportunity Act (ECOA). That reversal paved the way for further action.

For non-citizens with thin credit files or damaged credit, the change will make borrowing more difficult.

While the ECOA still prohibits discrimination based on national origin, lenders can now consider immigration status and deportation risk when deciding mortgage, auto, and credit-card underwriting.

The May 19 order built on the CFPB and DOJ’s January 2026 policy reversal, allowing lenders to consider immigration status in ability-to-repay (ATR) determinations.

The October 2023 CFPB-DOJ guidance discouraged lenders from using immigration status in credit decisions. Its withdrawal in January 2026 cleared the way for immigration status to be treated as a repayment-risk factor, rather than solely as a protected characteristic.

The May 19 order formally extended that approach to underwriting.

According to American Banker, the order sets an aggressive timeline. Treasury must publish a Bank Secrecy Act advisory within 60 days, and bank regulators also have 60 days to issue credit-risk guidance.

Treasury must also propose BSA changes within 90 days, and regulators must submit a joint proposal on customer identification requirements within 180 days.

This represents four tracks of federal regulation completed within one quarter, all applicable to the same decisions about credit extension used by lenders and by fintechs for immigrant households.

The resulting burden on banks will be substantial, said Ian Katz, Managing Director at Capital Alpha Partners, in the American Banker piece. The combined effect, he indicated, will be a major reorientation of subprime lending operations that institutions will have to implement quickly.

No amendments were made to the Equal Credit Opportunity Act. The law’s prohibition on discrimination based on national origin remains in force and is unaffected by the May 19 order.

The order mainly shifts how federal regulators interpret the rules. It treats immigration status as a legitimate risk factor, reducing fair-lending exposure and allowing lenders to rely on official guidance rather than prior CFPB enforcement interpretations.

But the law remains unchanged. Lenders that apply immigration status informally or blur it with national origin still risk ECOA violations.

Borrowers with limited credit histories and those rebuilding credit in immigrant communities are most vulnerable to higher rates or credit denial under the new approach.

The Institute on Taxation and Economic Policy estimated undocumented immigrants paid nearly $100 billion in federal, state, and local taxes in 2022, the benchmark year cited by the administration, according to American Banker.

Whether lenders actually experience higher credit risk under the new policy — or simply adjust their underwriting standards — should become clearer in the next quarter of mortgage, auto, and credit-card data.

For lenders, fintechs, and BaaS (Banking-as-a-Service) providers that serve immigrant populations, the new policy creates opportunities and challenges. It reduces fair-lending risk when immigration data is used for credit underwriting, but it increases compliance requirements.

Immigration data may now factor into both underwriting and anti-money-laundering reviews, while customer-identification programs (CIPs) will likely need updates within 180 days.

The compliance burden is shifting from fair lending to anti-money-laundering oversight. Institutions serving immigrant communities may have more flexibility to use immigration data in underwriting, but they will also face stricter requirements for customer identification and reporting of potential money-laundering activity.

President Trump signed an executive order on May 19 directing the Treasury Department, federal bank regulators, and the CFPB to provide guidance on the use of immigration status to assess credit risk and a borrower's ability to repay.

Treasury has 60 days for the BSA advisory, federal bank regulators have 60 days for credit-risk guidance, Treasury has 90 days for BSA rule changes, and the joint customer-identification proposal is due in 180 days.

The order builds on a January 2026 withdrawal in which the CFPB and DOJ pulled the October 2023 joint statement that had cautioned banks against using immigration status in credit decisions under ECOA.

ECOA still prohibits discrimination on the basis of national origin. But recent policy changes have weakened protections for non-citizens with thin credit files and those rebuilding credit. The impact on mortgage, auto, and credit card access should become clearer over the next three months.