The most significant factor in determining who is eligible for a home loan in the United States is not citizenship or even residency. It is income that matters the most. Someone who wants to apply for a home loan must have taxable income in the United States. Therefore, both permanent and non-permanent residents can qualify for a mortgage. However, we advise you to contact home loan and mortgage experts in Ohio and obtain your mortgage in the United States even if you are not a citizen.
If you live and work in another country and want to buy a house in the United States, either as a vacation home or as a rental property, you can do so through a special foreign nationality loan. Foreign domestic loans require large down payments, have high-interest rates, and are for investment property only.
An essential tip
If you are new to the country and need to establish credit, apply for a secured credit card. Having a credit history is the first step to being worthy of a mortgage.
Definition of legal residence
There are credit products for foreigners. Anyone who has legally established residence in the United States can apply for a traditional mortgage. Permanent residents of the United States receive their green card, which allows them to work and stay in the country. Non-permanent residents are considered those individuals who legally live in the United States and possess a valid work permit. Both can get a mortgage. To obtain legal residency and a work permit, an alien must be sponsored by a United States employer. Or, if you are self-employed, demonstrate the need for your experience in this country. In that case, they will need a US citizen to sponsor them. They will then receive a social security number, and their income will be taxed in the same way as a citizen’s income.
Showing proof of income in the United States
As US citizens, foreign residents must show how much money they earn by applying for a loan. Mortgage lenders generally require two to three years of employment and a stable income. Your tax returns should serve as proof of your earnings. If you are still earning money abroad, you will need to provide documentation to show how much you earn and that the income stream is stable. If you are applying for a mortgage, but your work permit in the United States expires soon, your lender may ask your employer to provide you with a letter. In this letter, he states that they intend to help you renew your work permit and continue to provide you with employment.
Creation of credit history
Foreigners also face the challenge of providing a credit history. Establishing credit history for the first time is difficult. Even a well-established foreign professional will have to develop a national credit history. Until you have established at least three sources of credit and have built a payment history, it can be an uphill task to obtain a mortgage. Generally, you will need a minimum of two years of credit history, and most home loan programs require that the applicant have ratings from all three credit bureaus in the United States. However, some lenders will accept a credit report from your home country, so keep a copy of this report handy. Generally, this option only works if your foreign credit report is from Canada, the UK, or Ireland.
The challenge of foreign assets
Many foreign residents in the United States still have their liquid assets deposited with a foreign bank. It can be challenging if you buy a home and use these funds for your down payment. The lender will need to verify the funds with an account statement and the source of the large deposits in the account in question. If the money comes from a family member, you will need to write a gift letter. The easiest way to get around the challenge of verifying foreign assets is to transfer the money to a domestic bank account at least two months before applying for a mortgage. Once the funds have been in an account for 60 days, the lender considers them ready, and no further documentation is required.
Final Words
All residents and non-residents of the United States of America can apply for a home loan and mortgage here. You only need to prove your income in front of the lenders, and they will accept your application. However, the best practice is to hire a home loan specialist. The reason is that these people are aware of all laws and regulations implemented in the United States. They prepare your application by following all these regulations. In this way, the chances of your application acceptance can be increased tremendously.
