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Foreign National Loans

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If you are not a US citizen, you may still be able to purchase a home in the US through a Foreign National Loan.

There are different requirements for a Foreign National Loan in contrast to other loan types, so read on to see if it might be the perfect fit for you.

Who is Eligible for a Foreign National Loan

Live and Work Outside the US

Qualifying for a Foreign National Loan requires being able to verify foreign national status. This means showing proof of residence and employment outside the US.

No Credit Score Needed

A credit score is not necessary to qualify for a Foreign National Loan. You can apply without a US credit score, and even without a foreign credit score, and it won’t be an issue for you.

Foreign National Loan Terms

Foreign National Loan

There are a few terms to expect when applying for a Foreign National Loan:

LTV Ration

A Foreign National Loan can have up to a 70% LTV, or loan-to-value ratio. This means the loan can be up to 70% of the value of the property. For example, a $1,000,000 can be purchased with a loan for up to $700,000, or 70%. This is important to keep in mind, as the down payment requirement for a Foreign National Loan is almost certain to be higher than other loan products.

Loan Amount

Loan amounts for a Foreign National Loan can range from $75,000 to $1,500,000. Whatever type of property you are considering, it’s possible that a Foreign National Loan will work for you.

DSCR of 1.0 or Above

A DSCR of at least 1.0 will be required for a Foreign National Loan on an income property. DSCR is the debt service coverage ratio. This is the ratio of income from the property to the debt payments for it, including principal, interest and fees. A DSCR of 1.0 means the income for the property is equal to the debt payments. Anything lower than a DSCR of 1.0 represents higher risk to the lender, and isn’t available for a Foreign National Loan.

ACH Automatic Payment

An ACH (automated clearing house) automatic payment from an FDIC insured US institution will also be required for a Foreign National Loan.

More: What is an asset qualifier mortgage?

Who is the Best Fit for a Foreign National Loan?

How can you tell if a Foreign National Loan is the right fit for you? Contact us with questions if you think you’re eligible so we can walk with you through the process. Here are some scenarios that might indicate you are a good candidate for a Foreign National Loan:

Real Estate Investor

If you are building a real estate portfolio and want to enter the US rental market, using a Foreign National Loan will open up many opportunities for you. While living and working in another country, you can purchase a US property and watch it become a passive income stream for you.

Being eligible for a Foreign National Loan means being a resident of another country, so keep in mind that you will need a local property management agency to make this plan successful.

Vacationing in the US

If you have family in the US or enjoy vacationing here, owning a second or vacation home makes perfect sense. Whether you choose to have the property operate as an income property when you are not there or keep it as an exclusively personal residence, a Foreign National Loan will make owning a US home an option for you.

Remember, if you do not intend to make an income from the property, the DSCR restrictions will not come into play. This may require additional assets or cash on hand to qualify for the loan, but it is still possible!

If you think a Foreign National Loan may be the right fit for you, or if you have questions about other mortgage options, contact us today to see how we can help you purchase your next home.

For more information on mortgages and home loans in Roseville CA or refinancing services for the entire Placer County California area or tips on buying a home, contact my office below or call me any time at (916) 847-7263

More Information for Homeowners

How To Know How Much Equity I Have In My Home

How Best to Take Advantage of Your Home Equity Gains

How Much Down Payment Do I Need for a Rental Property?

3 Ways to Know if Refinancing is Right For You

What is the Minimum Down Payment on a House?

What is Asset Qualifier Mortgages?

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Instead of qualifying for a mortgage based on your income, an asset qualifier mortgage means lenders may qualify you based on your liquid assets.

What is an Asset Qualifier Mortgage?

When you apply for a mortgage, one of the primary factors the potential lender will take into consideration is usually verification of income. If your verified income won’t be a sufficient number for any reason, another option available to you may be an asset qualifier mortgage.

Asset qualifier mortgages allow a lender to extend a loan to the borrower based on liquid assets such as a savings or checking account, stocks, or retirement account. The lender will look for the sum total of assets after closing and potentially approve you for a loan based on the funds you have available, regardless of your income.

What Does a Lender Verify for an Asset Qualifier Mortgage?

When a lender is considering your application for an asset qualifier mortgage, they will want to see asset statements for both liquid and nonliquid assets.

Your liquid assets are the primary focus for the lender. They will want to see bank statements for all savings and checking accounts, as well as retirement funds, money market accounts, and any other liquid assets you may have.

Generally speaking, the lender is looking for liquid assets to add up to a certain number. That number will vary depending on the loan amount you are seeking, but in most cases the total number of your assets divided by 360 (for a 30-year term) is considered your qualifying monthly income.

Lenders will also run a credit check. Even with substantial verified assets, your credit score will be an important component in getting the best terms on your loan.

Who is the Best Fit for an Asset Qualifier Mortgage?

An asset qualifier mortgage is ideally suited for a borrower who has considerable assets, but is without consistent, documentable income. This might be someone who is successfully self-employed but is paid irregularly. It may also be right for retired borrowers who do not have documentable retirement income, but have substantial savings and non liquid assets.

Another great candidate for an asset qualifier mortgage is someone who lives off of investments, with little to no taxable income, leading to many lenders to not approve you for any mortgage at all or not be willing to qualify you for the amount you know you can afford.

If you have significant assets set aside, you may not want to deplete this assets to purchase a property, even if you do have the cash available to do so. Allowing you to leverage your assets while keeping the majority of them liquid to continue growing them is one of the major advantages of an asset qualifier mortgage.

What Terms Can I Expect in an Asset Qualifier Mortgage?

Terms of an asset qualifier mortgage will vary. There are likely to be a variety of options available to you when it comes to how much down payment you will need, fixed-rate versus ARM loans, and the term of the loan.

It is possible to use an asset qualifier mortgage for a primary residence, a second home or vacation home, or even an income property. One of the biggest advantages of this unique type of mortgage is that it offers you ample flexibility in your investing.

Where Can I Get an Asset Qualifier Mortgage?

Not every lender is able to extend an asset qualifier mortgage as this is a unique loan program. If you think an asset qualifier mortgage may be the right fit for you, contact us today to see how we can help!

For more information on mortgages and home loans in Roseville CA or refinancing services for the entire Placer County California area or tips on buying a home, contact my office below or call me any time at (916) 847-7263

More Information for Homeowners

How To Know How Much Equity I Have In My Home

How Best to Take Advantage of Your Home Equity Gains

3 Ways to Know if Refinancing is Right For You

What is the Minimum Down Payment on a House?

Bank Statement Home Loan Programs Work Well for Self-Employed

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If you are ready to apply for a mortgage and you’ve been doing your research, you are likely aware that proof of income is a major factor in the approval process. If you are self-employed, it is reasonable to wonder how you might verify your income without the traditional paystubs. One option in this scenario is approval based on bank statements. Generally speaking, lenders will want to see two to three years of personal bank statements and three months of business bank statements. Verifying income based on bank statements rather than pay stubs and W-2s is an option available to you, and there are programs that can streamline this process.

Who Is A Bank Statement Loan Right For?

Bank statement loans are the right fit for anyone who needs to verify their income without a W-2. This might include entrepreneurs, investors, business owners, or freelancers. People who have a W-2, but are maximizing deductibles for business expenses, may also benefit from a bank statement loan because these write-offs make their income appear lower than it is. It may also be the right fit for you if yours is a multiple-income household where some of the income is verifiable with a W-2, but other streams of income are not and are essential to qualify for the loan amount you are seeking.

What are the Benefits of a Bank Statement Loan?

Other than the obvious benefit of not requiring pay stubs or a W-2, a bank statement loan requires less information, which means the approval and escrow process are more streamlined. Altogether, a bank statement loan requires less paperwork, which tends to result in a faster escrow, since there is less information to collect, process, and verify.

How Can I Qualify for a Bank Statement Loan?

While different scenarios and lenders will vary, generally speaking, a lender who approves you for a bank statement loan will want to see two to three years of personal bank statements, and three months of business bank statements (where applicable). These will help verify debt to income ratio, consistency of income, and income history.

Can I Get A Bank Statement Loan for My Refinance?

The short answer is: yes! A refinance is very much like a new mortgage, and bank statement loans are possible for it. Working with us will mean a more customized approach in comparison to a big box lender.

What Terms Can I Expect with a Bank Statement Loan?

Bank statement loans do come in a variety of types, so you can speak with your mortgage broker about which might suit your needs best. You will likely come across 30-year fixed and ARMs with a range of terms. Interest rates do tend to be slightly higher on a bank statement mortgage, and as a non-QM loan they are not regulated the way other mortgage programs are. This makes shopping around even more important.

To read a little more about what a bank statement loan is, and how we can help, check out this article. Not all lenders will be able to offer a bank statement loan, so you’ll need to work with the right lender, who will be well informed about and experienced with bank statement loan programs.

For more information on mortgages and home loans in Roseville CA or refinancing services for the entire Placer County California area or tips on buying a home, contact my office below or call me any time at (916) 847-7263

More Information for Homeowners

How To Know How Much Equity I Have In My Home

How Best to Take Advantage of Your Home Equity Gains

3 Ways to Know if Refinancing is Right For You

What is the Minimum Down Payment on a House?

How Much Down Payment Do You Need When Buying a Rental?

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Steelman Mortgages Powered by Answer Home Loans Company NMLS ID: 1729528. All information contained herein is for informational purposes only and while every effort has been made to ensure accuracy, no guarantee is expressed or implied. Any programs shown do not demonstrate all options or pricing structures. Rates, terms, programs, and underwriting policies subject to change without notice. This is not an offer to extend credit or commitment to lend. Although and subject to underwriting approval. Some products may not be available in all states and restrictions apply.