As a foreigner to get a loan for housing in New York: instructions and pitfalls

Getting a loan for a foreigner in the United States has gained a lot of myths - many tourists and immigrants are sure that it is impossible to buy real estate on credit in America without a green card. In fact, everything is much simpler. If you have recently arrived in the USA, then you have every chance not only to take out a loan on almost the same conditions as the Americans, but also to get a number of benefits compared with immigrants who have been living in the country for a long time.

How to do everything correctly and what important points need to be considered before you make a deal to buy real estate with the financing of an American bank, said a licensed real estate agent in New York Dmitry Stasyuk for YouTube channel Emigrantvideo. Note that the expert talks about the laws of the State of New York - in other states the conditions may vary significantly.

Why is it profitable for a foreigner to take a loan in the USA

If you compare a foreigner with an American or an immigrant who lived here for some time and officially showed his income for several years, then a foreigner has more advantages.

It is better to engage in a purchase immediately upon arrival. When you start working in the USA, it will be more difficult - the bank will require an American credit history for several years, statements of income from work in American companies. It may take 3-4 years before you build up enough “financial authority”. And immediately upon arrival, the bank sees you as a foreigner who buys a second home in order to come to America as a tourist and not to stay at a hotel. It is much simpler and faster.

How a foreigner can get a mortgage in New York

As a rule, specific banks specialize in specific areas, some work mainly with buyers of apartments, some specialize in houses.

Any solvent person can apply for a mortgage if they prove their financial status and lack of a dubious background. The applicant must meet the requirements requested by the specific bank. As a rule, these are: availability of money for the initial payment; a certain income that will show the bank that the person will be able to pay utility bills for the apartment and make payments for the house. Some financial programs have a lower limit (for example, from 100 thousand US dollars).

Where to begin

You must have a passport, an American visa, and you must be in the United States when applying. Visit a bank first to find out specific conditions and see if they will give you a loan at all. After studying your situation and documents, after a few days, the bank may issue you a document called pre-approval. With this paper, you can already look for specific housing options for a mortgage. The document will help a lot, because if you buy a house with bank financing, the seller should see that the bank agrees to do so.

There are certain banks working with foreigners where special programs are provided. The most popular among them providing this service are Citibank and HSBC, as well as Chinese banks, which consider all applicants.

The standard terms of the initial contribution - 30-40%, sometimes consider the option 25%. The money must be in the account in the American bank or in the bank of the applicant's home country. It is important to know that the amount in your account must be greater than the specified percentage. As a rule, it includes:

• required down payment;
• the amount that 12 will cost in months of payments to the bank and house;
• closing amount - 2-4%.

The services of a realtor are free - sellers pay for their services. Until the moment the transaction is completed, you, in fact, do not pay anything at all, except money for the services of a lawyer who will prepare all the necessary documents, but compared to the cost of the apartment, these are small expenses. Without a lawyer, not a single transaction is closed in New York - he checks the purity of the transaction, whether there are any restrictions on real estate, takes responsibility for the entire documentary part. The cost of a lawyer's services starts from 2 thousand dollars, depending on the amount of work. The average price is 2-3 thousand.

How is bank checking

You will need to bring your bank statements, a certificate from the company you work for, and fill out a questionnaire for additional information. For example, how long have you been employed, what other assets do you have, etc. The bank makes inquiries, including international ones, to check how true the information is and to make sure that you are not on the lists of debtors in your homeland, Interpol, terrorists, etc. This usually takes several days.

When a bank asks what money is in your accounts, it will take into account that this money must be there for at least 3 months - therefore, in this case, you cannot deposit money and withdraw it right away. It is important that the bank sees: you did not borrow the money, it is your personal. Until the transaction is closed, the bank will monitor the movements in the account and require confirmations and explanations for each relatively serious amount.

The bank tries to check as much information as possible: it will call the job that you indicated in the certificate, contact the bank whose data you provided in the certificate of financial status, and will try to confirm through all possible channels your solvency, the absence of a criminal history. The bank is interested in your payments - while you pay, there will be no special questions about what your real income is.

What do standard credit terms look like?

There is practically no difference in the percentage of the loan for an American and a foreigner. For example, you take a loan for 30 years, on average, the rate will be 4-4,5%. You can fix the rate for the whole term or for several years (in the second case, general conditions may be more beneficial). The Bank is not entitled to raise the interest rate during the time specified in the contract.

It is important to know that the bank may refuse to buy a specific apartment if it finds problems - sometimes this happens at the last moment. Therefore, we need a lawyer so that you do not sign up for the purchase of an apartment and suddenly do not remain without funding.

From start to finish, it takes at least a month to get a loan for an apartment or house, on average about two: you go to the bank, after a few days he gives you paper, you look for an option, then you sign the contract, the bank starts checking the apartment as well (all whether in the order of ownership, if there are any financial problems at home), then gives out money.

How much will the bank

Banks are ready to give foreigners no more than 3 million dollars, to which, however, you can add your own money and buy housing - there is no upper limit on the purchase.

New laws for wealthy foreigners: if you are the owner of a large company and you have more than three million dollars to buy an apartment in Manhattan, according to the new rules you will now have to disclose the name of the individual owner, although previously most businessmen purchased such property in the name of the company.

If you stopped paying on a loan

America has a very simple system of influencing debtors. Firstly, the bank has every right to require the defaulter to close the loan in a short, time-limited period. Secondly, it has the right to sell your house under the hammer very quickly, for which you paid all the previous amounts. And if you are not sure that you will be able to pay monthly installments, it is better not to get involved in a loan. In the United States, it doesn't matter how many young children will be registered in the apartment - keep this in mind.

It is important to know that the purchase of real estate will not help you legalize in the United States and will not contribute to obtaining a visa, unlike many European countries.