You may wonder how international buyers can obtain financing for their U.S. real estate investments.International buyers think that having a mortgage loan in the U.S. is difficult, when in fact it is quite the opposite. Let’s see what the requirements are. There are five requirements, the first one is to have a visa, a valid visa and if it is a tourist visa it is enough.
The second requirement is bank statements in your country of origin. The third, bank references in the country of origin. Also point number four, a letter signed by the accountant where you are going to demonstrate what your sources of income are. Requirement number 5, a water or electricity bill which is what will verify that you are a foreign resident.
Once the requirements have been obtained, we will move on to the terms.The terms are seven, the first of them is the interest rate which is between 4 and 5% at this time and they are historic lows in the United States. Second the down payment, the down payment is between 30 and 50 percent to defend on a single family home, if it is a condominium, if you are buying as a natural person or you are buying it with a company, what is your credit profile among other factors. Point number 3, what is the minimum that they will lend you? At this moment 75 thousand dollars, that is to say, do not have to give 35 percent of initial, the house must have a value of approximately 140 thousand dollars.
Number 4, what are the closing costs? The closing costs are approximately 4% of the value of the property, that is to say, if we are buying a property of 300 thousand dollars, on the day of the closing we have to bring an additional 12 thousand dollars to pay the mortgage costs. Requirement number 5 are the terms, generally they are 30 years, you can also get 15 or 20 years, but the most common is 30 years. The next point is what are the reserves? it is necessary to bring some reserves for the moment of tertiary, that will depend on the mortgage banks between 6 and 24 months is a signal that the banks have to know that in the case of an eventuality they can protect themselves and that the investor has the way to face those monthly payments of the mortgage.
Finally some terms of early cancellation, after being this the first year with an additional 3% second year an additional 2% and the third year an additional 1%, from the fourth year could not be paid anything and that last amortization during those first three years can exceed 20% to have these penalty rates once seen and the requirements.
Once the financing is obtained the monthly payment will consist of the mortgage, insurance, condominium association and if you have any additional expenses from a company to make the mortgage then these are also expenses that you have to take into account if your rent is higher than these expenses you can afford your mortgage loan.
Many companies that are now world renowned like Amazon, Microsoft, Google started with just a little bit of capital and the goal of becoming big companies, one resource they have used over time is credit. Unlike personal credit, company credit can be established quickly, although these are two separate credits, at the beginning they will go hand in hand because when you start applying for company credit many of the banks or lenders will ask for your personal credit as collateral, that is why it is important that you make sure your personal credit is in good standing. With this I don’t mean that you must have an excellent score, now if you have it much better because that will increase your chances of being able to establish your credit faster, if you don’t have it make sure you don’t have any collections and remember to pay on time this will help your personal credit look good and when you start to apply for your company card you will get it faster.
Many times banks will give you an offer or give you the option of giving you a prepaid credit card for your company, that is, you will deposit certain funds on this card, then you use the funds and then at the end of the month you pay off your card. now if this is something that is within your means it is totally recommended because as I said company credit is based on credit history, how long you have been using credit and how you are paying your bills then this will help you begin to establish this credit history.
Another thing you can do is apply for lines of credit or accounts with your suppliers if you are in construction, they are painters, plumbers, electricians, etc. and they know those big companies where you go and buy the dirt, the concrete, the materials. Well, all those companies give you the option of providing you with the materials you need on credit, generally this does not mean that you are going to pay interest on the materials, but that they are going to release the merchandise and give you a period generally of 20 to 30 days for you to pay the materials back, so these accounts are not complicated to establish, you basically go and ask them for an application and there you fill out the information of your company and sometimes they will also ask you for your personal credit. This is why it is very important to maintain your personal credit.