Many people come to the United States of America (USA) in search of new opportunities. Some stay for a while, some decide to live here permanently. Owning a home in Florida one of the booming in the US is a huge part of the American dream for many people. And for owning a home what do you need? Well, Of course, Finance!
Obtaining mortgage financing is complicated even for U.S. citizens. This can be more daunting when you are not a citizen and would like to apply for a Florida home loan. However, it is not impossible. With hard work comes great rewards; the same goes for this country. If you are planning to become a homeowner one day, it pays to understand the rules of applying for a mortgage as an immigrant with no credit history or documentation in the USA. It does get easier and faster with time, knowledge, and experience. I have written this article to help new immigrants understand the basic rules of applying for a Florida mortgage loan as an immigrant in this country.
Who can apply for a Mortgage?
Legal residency status within the US makes a non-citizen US eligible to apply for a mortgage. Florida mortgage companies have different policies but residency status proof is necessary. Non-US citizens who have permanent residency with a green card or a valid work visa or employment authorization documents have similar options as American citizens to apply for a mortgage.
How can a Noncitizen US Immigrant apply for a Home loan?
There are two types of Non-Citizens in the US: Permanent residents and Non-permanent residents. To apply for a mortgage permanent residents need a green card and a valid social security number. Nonpermanent residents on the other hand do not have a green card. They thus, need to prove their intention of buying the house as their primary residence. They need to show their Employment Authorization Documentation (EAD) along with a valid social security number. If the borrower does not have an EAD, he needs a valid work visa for a minimum of three years as proof of legal residency. People who do not have either of these documents can seek foreign national mortgages.
Getting the Best Lender
Finding the best Florida mortgage lender is one of the most important steps in applying for a mortgage loan. It's not easy; usually getting the right lender takes time and effort. You start by looking at their qualifications Perform the following steps:
Apply with a bank or Florida mortgage lending institution that has agreed to provide home loans for non-US citizens. Many lenders are willing to extend credit to non-citizens even if they do not have a credit history.
Non-citizens can also apply with credit unions, which are limited in their eligibility requirements. They offer competitive rates and have special lending programs for green card and visa holders.
Non-citizens can also qualify for government-insured mortgages that require a low down payment.
Credit Consideration
It is important to remember that non-US citizens, even with a green card or employment authorization documents cannot get unlimited credit. Your credit rating from a US credit reporting agency will be a key factor in getting a home loan. Non-citizens who have moved from another country will have to convert their existing credit to US credit for applying for a home loan.
If you are a non-citizen who has been relocated to the US through your company for employment, then you need to provide documents about your credit history from your home country. You will also need to provide a credit history from the US as well as your relocation company. This is because you can't apply for a loan with just an employment authorization document, but you'll have to show that both your employer and yourself are going to be able to make timely payments on the house or mortgage
For converting your credit you need your U.S social security number, pay stubs for proof of income, four credit references from your country of origin having a 2-year credit history.
Mortgage loans are complex and they require proper documentation in order to be processed smoothly. Make sure you have all your documents ready before starting the application process.
When do you need income and asset documentation and how will it affect your eligibility for a mortgage?
Applicants must be able to document their income and assets. Income can be documented by obtaining recent pay stubs and proof of income such as a tax return. Assets can be documented by obtaining documentation of ownership such as a bank statement or brokerage account statement.
If you are applying for a mortgage with the intention of purchasing a business, you will need to include pertinent loan documents and a business plan in order to prove that you're capable of repaying both your business and your home loan. The lender will also need to review the business's financial statements and records.
Different types of loans available for Non-citizen US immigrants
1. FHA Loans
The non-citizen US having permanent residency can apply for FHA loans. The Federal Housing Administration (FHA) offers a loan to non-citizen having low credit scores at the low down payment. Non-permanent residents applying for FHA loans require a valid social security number, employment authorization document, and 2-year work history. For an FHA loan in Florida, you need to make an upfront as well as monthly mortgage insurance payment to the Federal Housing Administration.
2. VA Loans
Non-citizen US immigrants who have served in the army can apply for VA loans. The VA does not require any down payment and offers low-interest rates with 0 closing costs. There is no minimum credit score requirement and the borrower can obtain 100% financing. Non-U.S. Citizens who are permanent residents can apply for VA loans, but they should have a valid social security number or work visa to be eligible for this loan program.
3. USDA Loans
US Department of Agriculture (USDA) offers the best mortgage rates to non-citizen US immigrants who are permanent residents. The Florida USDA home loans require a borrower to make a 3% down payment. The loan is fully assumable and there are no closing costs attached.
4. Freddie Mac Loans
Freddie Mac is another big lender who offers home loans to permanent residents or green cardholders. For getting approval on this mortgage program, you need at least 2 years of work history in America.
5. Conventional Loans
Non-citizen US immigrants who are permanent residents can apply for conventional loans in Florida. The borrower needs to make a 20% down payment, while some lenders might ask for more. You will need at least 24 months of job history and low credit scores below 620.
Bottom line
So by following the above guidelines a non-citizen can also buy a piece of American land and build your dream house. Get a pre-approved loan before you search for your dream house. Income and asset documentation, Employment Authorization Document and legal residency are needed for a permanent as well nonpermanent to qualify for a mortgage in the United States. Non-citizens must find lenders that are willing to work with them and will give them the best deal possible and then save up enough money to purchase a house.