Can a Non-US Citizen Get a Mortgage?

For many foreign nationals living in the United States, obtaining a mortgage to purchase your dream home may seem out of reach. But that’s not the case. So, can a non-US citizen get a mortgage? It’s possible to get a mortgage if you’re not a U.S. citizen. 

A 2020 National Association of Realtors (NAR) study showed that 62% of resident foreign home buyers acquired U.S.-based financing to achieve their dream of homeownership.

However, the mortgage application process can vary based on your residency status and other factors. Keep reading to learn how to get a mortgage as a non-U.S. citizen.

Is It Possible to Get a Mortgage in the US as a Non-US Citizen?

Yes. It’s possible to get a mortgage if you’re not a U.S. citizen. The only challenge is proving your creditworthiness to the lender. You’ll need to provide your credit history, employment history, and proof of income. 

This is a straightforward process for U.S. citizens, but things get complicated for someone who is a non-U.S. citizen and hasn’t built credit. Fortunately, some lenders don’t require borrowers to have a credit history to qualify for a mortgage. 

Some lenders may use non-traditional methods to evaluate your creditworthiness if you have no credit at all. For example, the lender may review the following information:

• Bank account information
• Employment verification
• Property records
• Payments for utilities, rent, and other recurring bills

Non-permanent vs. Permanent Residents 

Permanent and non-permanent residents can get a home loan in the U.S. like anyone else. However, the requirements for getting a mortgage largely depend on your residency status.

As a permanent resident, your mortgage process is like that of U.S. citizens. As a lawful permanent resident, all you need to present is a valid green card, your Social Security number, and two years of verifiable income. You may even qualify for government-backed mortgages, such as FHA loans. 

On the other hand, if you’re a non-permanent resident alien, it means you don’t hold a green card, which shows legal, permanent residence in the country. However, you can finance your home purchase using a work permit or a visa sponsored by your employer along with your Social Security number.

You must prove to the lender your ability to reside and work in the U.S. for a minimum of three years. Depending on your situation, you may be asked to provide other documents for mortgage approval. 

How to Prove Foreign Income and Other Assets

Most non-U.S. citizens don’t know that you can use your foreign income and other assets to qualify for a mortgage. However, you must verify this income either on a U.S. tax return or through a third party. Your mortgage lender will walk you through the process.

If the income documentation from your home country isn’t verifiable, lenders will qualify you based on your U.S. work history.

What Else Do Non-US Citizens Need to Get a Mortgage?

In addition to proving your legal residency and income, lenders may ask you to provide various documentation, including:

• Personal information: You’ll need to provide your ID, immigration paperwork, Social Security card, and rental history.
• Employment and income verification: If you’re employed, you must provide your recent two years’ worth of pay stubs and tax returns. For self-employed immigrants, 1099 forms may suffice.
• Asset verification: Your lender may want to see your banking and investment account statements, including checking, savings, and retirement accounts. 
• Debt obligations: Your lender may also want to review your monthly debt obligations to determine your ability to repay the mortgage loan. This includes credit cards, student loans, auto loans, and others.
• Credit score: While some lenders may approve your mortgage with little to no credit, you may need to provide documentation from your home country that shows your credit history.

Are There Any Mortgage Restrictions for Non-US Citizens?

Yes, there are a couple of restrictions for obtaining a mortgage as a non-U.S. citizen. Here are common restrictions immigrants may face when applying for a mortgage. 

• You must have a valid social security number, work permit, or employer-sponsored visa
• Put down a larger down payment, ranging from 20% to 50%
• You may have limited mortgage options and amounts
• You may be subject to higher interest rates compared to permanent residents

What Mortgages Can Non-US Citizens Get?

As an immigrant living in the U.S., you may qualify for the following mortgage options:

Conventional Loans

A conventional loan is a “conforming” loan that meets the lending standards set by Fannie Mae and Freddie Mac. Since these loans aren’t insured by any government agency, they typically have stringent requirements. 

To qualify for a conventional loan, you need a minimum credit score of 620, a two-year employment history, consistent income, and a debt-to-income ratio of 43% or lower.

While conventional mortgages have stricter lending requirements, they come with several advantages. For one, you may only need to put down a 3% down payment, depending on the home loan you choose. And if you put down 20% or more, you avoid paying private mortgage insurance (PMI).

FHA Loans

Backed by the Federal Housing Administration, FHA loans have more lenient eligibility criteria. You can qualify for an FHA loan with a credit score as low as 580 and a down payment as low as 3.5%. Along with this, foreign nationals must have a Social Security number, green card, and proof of consistent income.

One downside of FHA loans is that you must pay an upfront mortgage insurance premium (MIP) and monthly MIP. Upfront MIP is currently at 1.75% of the loan amount, while monthly premiums vary, ranging from 0.45% to 1.05% of the loan amount.

VA Loans

VA loans are insured by the Department of Veteran Affairs and are available to active-duty service members, veterans, and surviving spouses. The main advantage of VA loans is that they require zero down payment. Besides, this loan program doesn’t have mortgage insurance. However, they have a funding fee you can pay either upfront or as part of the loan.

VA loans typically require a Certificate of Eligibility (COE), a two-year work history, and a minimum credit score of 580.

USDA Loans 

USDA loans are available to low- and moderate-income borrowers in areas designated as eligible by the U.S. Department of Agriculture. Like FHA Loans, USDA loans don’t require a down payment.

Non-U.S. citizens require a valid Employment Authorization Document (EAD) and a Social Security number to qualify for these no-down-payment loans. You must also meet the income requirements. 

Similar to FHA loans, USDA loans come with upfront and monthly mortgage premiums. The good news is that these premiums are lower than FHA loans. However, you pay them over the life of the loan.

Non-QM Loans 

A non-QM loan or a non-qualified mortgage is a mortgage loan that allows you to qualify for a home loan using alternative methods rather than the traditional income verification needed for most loans.