Understanding Foreign National Financing

Real estate agent with client doing paperwork

While foreign nationals generally don’t qualify for conventional or government-backed loans, they may be perfect candidates for Non-QM options. Let’s look at how your clients who aren’t U.S. citizens can get mortgages at today’s attractive rates.

Who are the foreign nationals who may qualify?

In the U.S., a foreign national is defined as a citizen of a foreign country who is not a citizen of the United States. They can be U.S. residents, non-resident aliens with tax identification numbers (ITINs), or possibly “Dreamers,” recipients of the Deferred Action for Childhood Arrivals program, or DACA. If your client can legally enter and purchase property in the United States, they may be a foreign national who might benefit from Non-QM loans.

For Those Who Don’t Fit the Mold

It’s something many of your clients may not know: Non-QM products are designed to be borrower friendly, and more accommodating than many conventional and government mortgage options. The big difference with Non-QM, and one that affects foreign nationals disproportionately, is that Non-QM loans look beyond pay stubs, credit scores, and W-2s in assessing the creditworthiness of potential borrowers.

You can explain that traditional U.S. documentation isn’t always required. Nor is a U.S. credit score or having an established credit history in this country. Instead, lenders look at the liquid assets of a potential borrower, or the income that’s generated by investment properties — i.e., the ability to repay the loan.

Created With Investors in Mind

Rather than loans for primary residences, the foreign nationals program with Luxury Mortgage Wholesale is meant for second homes and investment properties. Loan amounts go up to $3MM, available with both fixed-rate and ARM mortgages. And they’re not just for first-time investors — foreign nationals can also take advantage of a range of refinancing options.

It’s a Growing Market

You could very well have quite a few more clients who are foreign nationals in the near future, as the U.S. Congress is reviving the EB-5 visa program. Suspended in June 2021, the program gives green cards to some foreign investors; the ripple effect will mean that there are more foreigners who are investing in the United States, and therefore more folks who are prime candidates for Non-QM loans.

Some brokers may be wary of working with foreign investors. They shouldn’t be. Not with the foreign nationals program in the Simple Access® suite of Non-QM products from Luxury Mortgage Wholesale. Contact us today to discuss how you can expand your portfolio with foreign nationals who are ready to invest.

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