Young credit score, just moved to USA

2 Replies

My wife and I have spent the last year or so getting myself a green card and have moved from Canada to upstate NY. We are brand new to this country and have very little credit history but very much want to get started investing in real estate! We hope to purchase a duplex and house hack. Shouldn't be more than about $100k but I'm worried about us being approved for a mortgage given that we're "fresh off the boat". I'd like some opinion on our situation and how we should proceed.

I've been working for about 5 months, my wife for about 3 months in the US. Based on CreditKarma, our scores are 1 year with 720 (my wife) and myself with 2 months at 690. We've recently taken out a loan on a car, and have opened new credit card and bank accounts (both about 2 months ago when I was first able to open an account in the US). We would have to both apply since I believe my income is what will get us the loan (about $75k household income).

Prior this, we have great credit and employment history in Canada, but I'm unsure if any of this matters to a US bank. I plan on calling some Canadian banks that have branches in the US (RBC, TD) and speaking with them but I'm seeing that they may require a higher down payment (75% LTV) and we're only really prepared to put down 5-10%.

What do you think? Should we just focus on aging our credit a bit more? How long would you recommend? Are we more likely to be approved if applying for an FHA loan?

Hi @Sean Lauber ,

Your credit is fine.

Employment history is more likely to be what bites you in the butt. 

  • You may have to sweet talk some Canadian HR people from your former employers, as they likely are not used to filling this form out. I'm vaguely aware that Canada has different privacy protection laws than the US, and have had mixed results with Canadian employers on that front (maybe it varies by province?). 
  • You're going to need to work with a local lender that does non-vanilla scenarios. It sounds stupid, but an "average" underwriter and LO are simply going to have their heads explode when they ask you for two years of tax returns, and you give them Canadian tax returns. I know it can be done because I've sat on google translate to annotate German tax returns into English, along with past-dated USD currency conversions to get a loan through, but yeah this is one where you need to shop primarily the competence of the lender, and shop it hard. (I haven't crossed the "what if the tax returns are in a language that doesn't use Latin alphabet?" bridge yet...) 

Thank you for the advice @Chris Mason

I think at this point my best bet would be to talk with a broker who might have a better idea of which lenders to work with. Our 2015 tax returns look great but the 2014 doesn't look so good since we were between jobs. Hmm, I suppose we'll have to present what we have and see where that gets us. Thanks again.

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