Unfortunately, the only forgiveness that existed for entering illegally was under INA 245(i) which states that if she had an I-130, I-140 or Labor Certification properly filed for her ON or BEFORE April 30, 2001 AND she could prove that she was inside the U.S. on December 21, 2000 unless the I-130, I-140 or Labor Certification was filed on or before January 14, 1998, then she could pay a $1000 penalty and adjust status to U.S. Lawful Permanent Residency. If she did not have any of those types of applications filed for her before that date, then she has three options:
1) Wait for the immigration reform that comes out. If it is approved the way that they are intending, then she may be able to get Residency if she entered the U.S. early enough.
2) Apply for Asylum (she had to have done this within the 1st year of being in the U.S. unless there is a credible excuse or changed country conditions), Withholding of Removal, Convention Against Torture, or Cancellation of Removal. The first three things are if she fears to return to her home country because she believes that she will be specifically targeted due to her race, religion, nationality, social group or political opinion and that she runs a high risk of great bodily injury, torture, or death as a result. The last, Cancellation, she would have to prove that she has at least 10 years in the U.S. AND she must also prove that if she is deported, a U.S. Citizen or Lawful Permanent Resident that depends upon her will suffer exceptional and extremely unusual hardship. This hardship must be something more than emotional separation hardship or financial hardship, so it is difficult to get. Since she hasn't gotten to 10 years in the U.S. yet, this will not be helpful.
3) If she were to divorce you and marry a U.S. Citizen (for love, of course), she could file an I-130 here in the U.S. (which will give her no legal status), but once that I-130 is approved, really the only thing she can do is leave the U.S. and apply to come back in at the U.S. Embassy/consulate in her home country as the spouse of a U.S. Citizen. At that point, they will want to deny her because she entered illegally and stayed. So she would have to apply for an I-601 waiver (forgiveness) and to get this waiver she will have to prove that her spouse will suffer extreme hardship if she is not allowed back in to the U.S. These waivers are very difficult to get. The reason they are difficult to get is because your hardship probably will need to be more than just economic hardship or emotional separation hardship. So because they are difficult to get, no one wants to risk leaving the U.S. and getting stuck outside for 10 years if it isn't granted.
You can look at this link to get more information on I-601 waivers. It is from the U.S. Embassy in Syria, but it is a good description and the process should be similar in all U.S. Embassies.
and here is another link:
And here is a link to what extreme hardship is:
And about Obama's new law, the I-601A waiver, it isn't a new law. It is a new procedure. What has changed is that before, a person had to leave the U.S. and spend around 15 months or so while waiting for their appointment at the U.S. Embassy or Consulate in their home country and then HOPE that they got approved, but the change is that now the same person can apply inside the U.S., get a pre-approval, and then with that pre-approval they can leave the U.S. for just a few days or even a day, present themselves for a scheduled appointment at the U.S. Embassy or Consulate, and then get the final approval and come back as long as there are no other reasons of inadmissibility, just having entered the U.S. illegally or having overstayed. Here is an official link:
I am truly sorry for the bad news, but the options are very limited at the moment. Regardless, at least you know the truth and that will keep you out of the hands of unscrupulous attorneys that are looking to take advantage of a desperate situation to charge thousands of dollars for something that has very little chance of producing a positive result.
Also, you pretty much have the same options if you entered illegally as well, but at least you have DACA which is temporary protection against deportation. Hopefully in the future they will approve DAPA and your spouse could get similar protection.
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