The government and government employees are completely divorced from reality. Besides the fact that ILLEGAL aliens are in the country illegally and therefore should be kicked out of the country, it is insane to require banks to give loans to illegal aliens because they are too big of a risk. An illegal alien has proven they don't care about laws and therefore they are more likely to not repay their loans. Because they are here illegally, they could get deported and then be unable and/or unwilling to repay their loans and there would be no way for a bank to collect. In the same way they could get tired of being second class citizens and just decide to leave the country and also not repay loans. No person or business in the right mind would give a loan to most illegal aliens (I won't discount some exception where the person was personally known).

Since the government bypasses normal economic laws (temporarily anyway), they don't understand how things really work. They make laws that may sound good, but are contrary to reality and therefore will cause destruction.