Securing a mortgage can be an intimidating, complicated process in any circumstances — let alone when you are not a citizen or resident of the United States. In addition to potential language barriers, there are several technical barriers to overcome.
Without a local mailing address, you may encounter difficulty signing documents in a timely manner, which can delay loan processing. As most lenders require your down payment money to be seasoned, you must make sure your funds meet the requirements (usually in your account in the U.S. for at least 60 days). If you cannot provide sufficient credit history, proof of income, and employment documentation required for a mortgage, you will likely not be able to obtain financing.
Do not let these challenges scare you away from pursuing a mortgage in the U.S. as a non-resident, though. With the right guidance and approach, you can successfully secure a non-resident mortgage.
Below are six steps to help you navigate the challenges of getting a home loan as a non-resident.
Find a lender who understands your situation and speaks your language. Make sure the lender has online capabilities and e-signing capabilities if you will not be staying in the U.S. during the entire loan process. Ideally, the lender will also offer digital solutions such as online scheduling, videoconference capabilities, and an application portal that enables you to manage your non-resident home loan while outside of the U.S.
To make the non-resident mortgage loan process run more smoothly, it is important that you do your homework ahead of time. Start by opening a U.S. deposit account with the funds available for your down payment, closing fees, and reserves. This shows your lender that you are serious about your loan and helps avoid delays.
Make sure to keep documentation of all your deposits, as well as the source of your funds. You will also need to provide monthly bank and/or investment account statements to your lender as a foreign credit check as part of your mortgage application. This paperwork verifies your financial standing, showing the lender that you are trustworthy and have the ability to repay your mortgage.
Alert your loan officer as early as possible if you will need a power of attorney to sign loan documents on your behalf when you are overseas. These days, it is much easier to sign documents remotely with e-sign technology. But in some cases, such as when loan documents get sent to escrow companies or attorneys, you may still need to sign in person. Remember to make advance arrangements if you require a power of attorney to execute the loan documents on your behalf.
The last thing you want is to incur a late fee. Make sure you have enough money in your payment account at all times to cover at least three months of your mortgage payment. By setting up automatic payments to your mortgage, you will be able to make your payments in a timely manner and reduce the hassle of sending in payments monthly. You may also qualify for a discounted interest rate, depending on the lender.
This type of account is set up through your lender to help you save for insurance premiums and property taxes. The money in this account comes from the additional amount paid to your lender in your monthly mortgage payment, helping you put aside money early and ensuring you have the funds to pay for your insurance premiums and property taxes as they become due.
Getting a home loan as a non-resident can be tricky. It all comes down to having the right bank that understands your situation, keeps you informed and guides you through the process.
At Cathay Bank, we have knowledgeable loan officers, many of whom were once immigrants and are eager to help non-U.S. residents understand the U.S. mortgage process. They have already gone through the process of settling in the U.S. and know what it takes, so they can provide guidance for your situation.
Contact us to learn more about how we can help you secure a non-resident mortgage loan. We have mortgage loan originators who can also speak Chinese (Mandarin and Cantonese), Spanish, and Korean. Call 888-228-4293 or schedule a remote appointment.
This article does not constitute legal, accounting, or other professional advice. Although the information contained herein is intended to be accurate, Cathay Bank does not assume liability for loss or damage due to reliance on such information.