Foreign National Loan
America remains a top tourist attraction worldwide, with over 79 million foreign visitors a year. Many are seduced by the American Dream and sooner or later they wonder how they could become owners of real estate in the US. Although more than 70% of foreign real estate investors had paid in full for their purchases, the remaining buyers have to qualify for a mortgage. And since conventional mortgages are out of their reach, the only option is a foreign national loan, or real estate investment trusts (REIT).
What makes foreign national loans appealing? The fact that there is no age restriction. Individuals may qualify for a 30-year mortgage even if they are 70 years old. Foreign National Loans can be secured by individuals, LLCs, corporations, or offshore companies. The interest rates can be both fixed and adjustable, with amortization periods of 15, 20 and 30 years. Foreign National Loans, also known as ITIN loans, as the borrower must obtain an international tax identification number from the IRS, must be used only for real estate investments, or non-owner occupied properties. They cannot be used to finance a primary residence.
ITIN loans are usually used to buy properties in the US by undocumented immigrants as well as by foreign investors. They have to save at least 20% for a downpayment, but most of them keep up with their monthly payments, and so far defaults have been extremely rare.
Credit unions are more likely to lend money under the provisions of a Foreign National Loan, as they compete against larger banks and online lenders. In the absence of a social security number, they rely on ITINs, driver license, letters from employers and bank statements. ITIN loans are available from a few dozen lenders across the US, such as Illiana Financial, Point West, Guadalupe Credit Union, Latino Community Credit Union, and Alterra Home Loans. All in all, Foreign National Loans are quite easy to obtain and will continue to lure real estate investors both inside the US borders and outside of them.
Popular Real Estate Terms
Association of people not treated as a corporation. Examples are a limited partnership and a group of cooperative owners. ...
An individual's possessions at his residences, such as furniture. A listing of items and their costs is recommended to obtain proper insurance coverage and as support for insurance ...
Capacity in real life has numerous meanings. So, what is the definition of capacity? The “capacity definition’ applies to the highest amount a distinct object or entity can ...
(1) Price a buyer is willing to pay, or bid, for a certain piece of property. It is the highest price offered to buy the property. (2) Price per share that shareholders receive when they ...
Present worth of the property which is different than the price paid for it or its book value (cost less accumulated depreciation). The current value may be determined through appraisal. ...
Homes with division of ownership or use of a resort unit on the basis of time periods. For example, a resort home may be divided into 25 time shares of two weeks each, with two weeks left ...
The term foreign direct investment (FDI) refers to the purchase of an interest in a company from an investor or company that is located outside of the borders of the company in which the ...
Special tax incentive for the continued use and rehabilitation of historical buildings and old structures in an effort to arrest urban decay. Developers receive a credit based on a ...
The term developer’s profit is the actual profit generated by a developer’s project after the costs of the development have been covered. This profit can come from the sale of ...
Have a question or comment?
We're here to help.