Most mortgage advice articles for US properties assume that the person reading is a US citizen, but this is not always the case. There are actually a substantial number of non-US citizens buying property on the mainland, and the process is somewhat different. Here are the basics of conventional loan requirements for non-US citizens.
Do I Have My Legal Documents Ready?
Even citizens of the US get scrutinized over their identifying documents, so you should have them ready and waiting. Permanent resident aliens are equal to citizens in the eyes of US lenders as long as they have proof of residency.
There are several forms that prove residency, including a Green Card, an up to date passport that is approved as I-551 evidence, an I-94 form that shows grant of refuge, a foreign passport that has a permanent residence admission alongside an authorization of employment document, and any other documents given to you by United States Citizenship and Immigration Services.
Non permanent resident aliens have different requirements depending on the loan that they want. Conventional loans are the easiest to legally qualify for: The only document necessary is a valid work visa. However, you must prove to your lender that you will be working in the United States for a few years. You will probably be asked to renew your residency for the first few years of the loan. Bring form I-766 and form I-797A with an attached I-94 as a second form of ID.
Non resident aliens who are looking for a jumbo loan will need a bit more residency and history of employment. Three years in the country working is the industry standard. However, the process gets a bit more complicated for nonconforming jumbo loans. You must have residency for at least five years and prove a high likelihood of continued employment for an additional three.
You will only be eligible for single family unattached or condominium housing, and the owner must be a resident of the property. The lender will require a 30 percent minimum down payment, and the documents that you will need include a valid passport, form I-140, and an employment authorization card. H-1B and H-2B visas are the only types of visas that are accepted for non resident aliens.
Are There Any Restrictions on the Transactions That a Non-US Citizen Can Take On?
For the most part, lenders and the government are looking for people who plan to be in the United States physically. If you are only in the United States for less than a year, then you will probably fall short of the standard that is needed to convince a lender of your ability to pay a loan.
Only people who are subject to United States law can enter into a mortgage agreement. This means that anyone with diplomatic immunity cannot take a loan, because they are not subject to the law.
What Are the Credit Requirements?
After you have all of your paperwork together, the next aspect of your mortgage qualification is financial. You must convert your credit to US credit before you can apply for a loan that is underwritten by a US company. You may be able to get away with a credit check of your home country’s credit; however, you will need the relevant financial records from your country.
You will always need a United States social security number (SSN) in order to qualify. As with any citizen or non citizen borrower, you will need to bring in pay stubs as proof of your consistent income. References from former and current creditors are a great addition to this profile: Try to have four if you are relying on people from your home country to vouch for you. They will definitely be contacted, so make sure that their contact information is up to date.
Your financial situation will determine whether the lender requires a credit conversion into US credit. The more cash you have on hand and the longer your credit record, the less likely the lender will be to require this. You may need to find a specialized lender in order to accomplish this conversion, because not all lenders are prepared to convert credit.
What Government Sponsored Entity (GSE) Is the Best Institution for the Non-US Citizen?
The Federal Housing Administration (FHA) has perhaps the least difficult real estate buying process for non-US citizens, so you should look here first for your GSE loans. They are by far the most flexible when it comes to the minimum residency and employment requirements, and they will also give you the most leeway when it comes to the actual mortgage terms. The volume of the business the FHA does as well as its reach allows it to be more lenient than other GSEs, so this is likely your best bet.
America welcomes investors and workers from all parts of the world. If you are a non-US citizen, you have many paths to homeownership in virtually any community that you want. The scrutiny is intense, but the final reward is well worth it.
2 Point Highlight
There are several forms that prove residency, including a Green Card, an up to date passport that is approved as I-551 evidence, an I-94 form that shows grant of refuge, a foreign passport that has a permanent residence admission alongside an authorization of employment document, and any other documents given to you by United States Citizenship and Immigration Services.
If you are only in the United States for less than a year, then you will probably fall short of the standard that is needed to convince a lender of your ability to pay a loan.
