Foreign Persons

Foreign Persons

Foreign National, Permanent Resident Aliens, Non Permanent Resident Alien, ITIN

Citizens / US Persons and Foreigners Each Borrower, who is a natural person, must be classified as either:

  • A citizen / US person, which for the purpose hereof shall include all U.S. citizens, all holders of immigration document 1551 { green card }, all persons who have been approved for 1551 { green card }, status and can document such approval { typically through immigration form 1797 } and all persons holding visas allowing residency in the United States that are acceptable to Fannie Mae, provided that in no event will a person holding an "A" class { diplomatic visa } or "G" class { international organization visa } be eligible for financing.

Types of Classifications

  1. Foreign National
  2. Permanent Resident Alien
  3. Non-Resident Alien
  4. ITIN {Individual Tax ID Number}

Definitions

Foreign Nationals are defined as individuals who are not U.S. citizens or, regardless of citizenship, are representing a foreign government, foreign corporation, other foreign entity, or foreign national doing business with a Department of Defense {DOD} component or contractor.

For U.S real estate and mortgage purposes, a foreign national is a person who is not a citizen of the United States and or is a citizen of another country that is living in another country and is purchasing real estate in the U.S.

A Foreign National is an immigrant, alien, foreigner or non-citizen.

Permanent Resident Alien

Referred to a foreign national who has been granted permission to live within the U.S. legally and indefinitely. Those who are granted U.S. permanent resident status are issued an alien registration card, also known as a green card, that is used for employment eligibility. They have the right to work in the US. They can apply for a social security card and can apply and qualify for any type of mortgage such as FHA, Fannie Mae or Freddie Mac, they have the same options as an American Citizen, in the same manner as a U.S. citizen however they retain citizenship in another country.

Non-Resident Alien

A Non-Resident Alien is an alien who has not passed the green card test or the substantial presence test. Non-Resident Aliens are here temporarily and are only taxed on their income from sources within the U.S

While they have no legal or constitutional rights to remain within the U.S., they may stay provided that the government renews their VISAS at the expiration of the previous visa. If you are a non-resident alien, you need to file a tax form 1040-NR if you worked in the U.S. or have U.S. sourced income from rental property. They are required to pay income tax on any money earned in the U.S.

Nonresident aliens with an eligible visa can qualify for mortgages but must need to prove eligibility status, lawful residency, have an eligible visa, must show the likelihood of continued employment, must show employment authorization documents and then the approval is up to the guidelines of the individual lender.

ITIN - Individual Tax ID Number

ITIN, or individual Taxpayer Identification Number, is a tax processing number only available for certain nonresident and resident aliens, their spouses and dependents who can't get a {SSN}. An ITIN number is for residents with foreign status.

The way to identify an ITIN number is that it is a 9-digit number, beginning with the number "9" formatted like a SSN number.

The benefit of an ITIN loan is that they have much more flexible credit requirements than a SSN however the rest of the requirements are similar to conventional loans. The FHA does not offer ITIN programs. The mortgage programs available to an ITIN is based on the guidelines of the individual lender.

Three Types of Identification

  1. Permanent Resident Alien Card {Green Card}
  2. VISA {Traveler}
  3. Passport

All Foreign National Qualifiers, except those that are from countries that are on the Office of Foreign Assets Control - OFAC list. {subject to change}

A published list of individuals and companies owned and controlled by, or acting for or on behalf of targeted countries that are considered to be working with individuals, groups and entities such as terrorists and drug traffickers designated under programs that are not country specific.

List of countries: Afghanistan, Balkans, Belarus, Burma, Central African Republic, Côte d'Ivoire, Cuba, Democratic Republic of Congo, Egypt, Haiti, Iran, Iraq, Kenya, Lebanon, Libya, Myanmar, Nigeria, North Korea, Pakistan, Somalia, Sudan, Syria, Yemen and Zimbabwe.

Acceptable Evidence of Residency

Foreign National

  • Work Visa
  • They must live and work in another country
  • They cannot purchase a Primary Residence
  • VISA Types: B1, B2, H2, H3, L, J1, J2, O2, P1, P2

Qualifying Credit

  • When SSN Applies: Min 620 to 680 Dependent of Mortgage Product
  • No SSN or ITIN #: None Required
  • Open trade lines for 2 years - No derogatory credit history
  • Second Home or Investment Property Only
  • Non Occupant Co Borrower Not allowed

Mortgage Programs

  • Full Doc, No Ratio, DSCR, Bank Statement, Bridge, Construction

Loan Details

  • Minimum Loan Size: $50,000 for Single Unit, $75,000 for 2 to 4 Unit
  • Maximum Loan Size: $2,000,000 for Single Unit, $3,000,000 for 2 to 4 Unit
  • Note: Larger than 3 Million up to 5 Million by Exception Only

Maximum LTV

  • 75% Purchase
  • 60% Cash Out Refinance

Income Verification

  • W2 Wage Earner: Most current W2 + 2 Years Tax Returns & Letter from Employer
  • Self Employed: Self Employed for 2 years-2 yr Tax Returns & CPA Letter

Reserves

  • Max LTV 12 Months -- LTV Reduced 5%, 6 Months

Assets

  • 2 Months Current Bank Statements

Gifts

  • Not Allowed

Ownership

  • Individual Name
  • Limited Liability Company
  • Corporation
  • Partnership
  • Signed as an individual by all members of the entity

Permanent Resident Alien

  • Alien Residential Receipt Card Green Card 1-151
  • Conditional Resident Alien Card With Filed INS Form 1-751
  • Non-Expired Foreign Passport Valid for 3 years

Mortgage Programs

  • Same as US Citizen
  • Primary, Second Home, Investment Property

LTV

  • Same as U.S. Citizen

Ownership and Gift Funds

  • Same as U.S. Citizen

Non Permanent Resident Alien

  • Visa Types: E1, E2, E3, EB-5 Through G-5, H1B, L1, NATO. O1, R1, TN NAFTA
  • Visa Must Be Current

Qualifying Credit

  • When SSN Applies: 620 Minimum { If Available }
  • No SSN or ITIN #: Open trade lines for 2 years - No derogatory credit history

Mortgage Programs

  • Primary, Second Home, Investment Properties

LTV

  • Purchase Maximum 80% Full Doc
  • Purchase Maximum 72.5% Debt Service Ratio
  • Refinance Maximum 70% Rate & Term
  • Refinance Maximum 65% Cash Out

Ownership

  • Non Occupant Co Borrowers Not Allowed

Gift Funds

  • Not Allowed

ITIN Program

  • Alien Citizenship: ITIN Card or IRS ITIN Letter Required, Photo ID
  • LTV 85%
  • DTI 50%
  • Allowable Properties: Primary, Second Home, Investment Properties
  • Documentation: Full Doc, 24 Month Bank Statement & DSCR
  • Gifts: Allowable

Ineligible Properties

  • Multi Family 5+ Units
  • Mixed Use Residential 1 to 4 Unit Only
  • Cooperatives
  • No Ground Leases
  • Condo-Tels or Timeshare
  • Mobile or manufactured Homes
  • Properties with a lot size greater than 1 acre
  • Raw land, Working farms or Ranches
  • Single Room Occupancy
  • Assisted Living, Nursing Homes