I am a US citizen who lives and earns my income outside of the United States. I am working on starting my real estate investment path but I have run into a snag related to lending and mortgages. I have tried applying with a few different banks but have run into the same problem: They don't want to lend to me because my income is not from the US and I am not issued a w2. I have money saved for a down payment and more saved to use as proof of funds.I want to note that I have been filing my taxes in the US for the past 4 years and I also have a proof of income statement from my current employer. I also have my pay slips from my previous employer along with 1 years worth of tax information from my current host county.
If any of you have been in this situation before or have any advice how to proceed I would love to hear it.
You are going to have trouble getting a traditional loan. Look for a portfolio lender, who will most likely charge a higher interest rate. Banks want to be able to go after your income if things go south. That is much harder (if not impossible) if the income is earned outside of the USA.
I agree with Laura. Look for HMLs or portfolio lenders who make loans primarily based on the asset. Those lenders typically will look to cash reserves and experience over W2 stated income.
Thanks for the advice everyone. I am going to be reaching out to a few portfolio lenders in my target area and see what my options are.
You are a US citizen earning foreign income which means you are required to file income taxes in the US. So, yes, you can qualify for purchasing using conventional loan. Unless, of course, you choose to not file and pay taxes, then that would be a problem.
You’re not speaking with lenders that know what they are doing. Keep calling around. I have done countless such loans.
As of October, if you do not have a primary residence in the US, you will no longer qualify for a fanne/freddie backed loan. I've been on the phone with Fannie/Freddie about this several times over the past two months... it sucks. But the good news is that there are other options. If you are looking into investment properties, many of the DSCR lenders will accommodate you just fine. NO income needed. The only snag I have run into is that you need to have a US based bank account with enough reserves in it, if required.
Not an investment property, no problem. Many Non-QM lenders may lend to you. You will be considered a foreign national in most cases which means higher rates and lower LTVs, but they can get a deal done for you.
I'm in a similar boat to Max and am trying to do a cash-out refi for my investment property in New York. Is it possible to get a rate under 4%?
I am currently in the process of moving funds into my US based bank account, but the process is slow going because my host country hates having money leave. Do you have any recommended lenders. I think I may have found one, but I won't know for sure until I get my down payment wired into my US bank account.