Real Estate for Foreign Nationals

Thanks Ricardo! Just so you know, it’s a matter of knowing who has the resources and who can address our clients’ needs on the spot.

Most of the Foreign Nationals we are helping are those that don’t live here and don’t work here – the true Foreigners who want to buy a vacation place or buy real estate as an investment. They have no US papers or documentation…….I’m sure those are more difficult loans.

My last experience with a Foreign National Closing (that wasn’t cash) was a gentleman from Venezuela closing on a beachfront unit in Miami Beach for $875,000. He put down $250,000 for a down payment and the loan was done by Countrywide. The actual closing was a nightmare because they delayed the closing and expected him to stay in the country one more week – at the time, I was allowed a power of attorney to close for him, but that cannot happen here in Florida in many instances anymore.

How to offer a clear and concise closing date (since they are traveling from outside the country) – give good service and know the requirements ahead of time so the transaction goes smoothly…..that’s the question of the century.

Bob – the ones we have done with local brokerage accounts are a piece of cake.

By the response on this you can tell how difficult it is – and to think that 3 out of 5 sales in Miami are foreign nationals…..you would figure someone would specialize

Brian, please include the links – that’s exactly what I was hoping for when I wrote this.

But even with great reports and information to give our Foreign National customers I still think it’s even more important for a live contact to be able to give them.

Latin Americans as well as Europeans will ask you for a specific person to help them, they don’t want to do the research nor take the chance.

One more thing. I saw that at the Inman Connect conference there is a session on this topic. That should be interesting.

Brian R – can’t wait to see your new platform – you are definitelly going into untapped territory

Brian B- you are hilarious …. Now you want me to be a loan originator? Rick actually has a mortgage license (got it for the knowledge for our clients – but don’t want the conflict)
we could certainly translate when necessary, and the loans do not need to be local.

Ricardo is providing some great info – you need to open up doors for those loans and mail the paperwork to a local title company or attorney.

What makes it harder, Ines, is that many of the banks and brokers that advertise “Foreign National Mortgages” on their Web sites are defunct. You can waste a lot of time doing research, chasing money where there’s really no money available to be chased.

I work with a lot of Foreign Nationals in the Chicago market and have come to prefer private money sources for my clients that don’t have social security numbers or a real reason to be in the U.S. other than to own property here.

Remember: all that the banks have in mortgage transaction is collateral (i.e. equity). If that equity is slipping away with the market, it makes the loan more risky. Florida gets a lot of bad press (and so does Arizona, Nevada, and California) — it’s no surprise that your clients may need 40% down or more. It may also be why Chicago is drawing such strong Foreign National attention.

Call me anytime — I’m happy to talk to you at length about this kind of stuff. It’s one of my favorite markets in which to work.

Benn – The problem with doing my own originating is an issue of time and expertise. Talk about being a Jack of all trades and master of none (and the time issue is also there)……I just want someone good to handle them (but I will not discard the idea, if it’s my only way out). The automated LO sounds pretty awesome…..I will have to see what you are talking about.

Dan – that’s EXACTLY what we’ve encountered……chasing the money is not fun and can take a long time when some of these clients are ready to go immediately. It’s a matter of working with someone that knows where to get the funding and what direction to take depending on the client’s situation.

Maureen – what’s happening to us is that we are getting tons of calls from South America and Europe and although we are ready to address their real estate needs, we are short on the loan side. First it was about speaking Spanish, now it’s about offering a complete package. Mortgage professionals ready to attack these loans no matter the country, price range nor buyer’s particular situation.

Bill – I totally see what you are saying, and in my case, I would always look out for the best interest of my client – I think “conflict of interest” is something that we, as REALTORS are always associated with. A big percentage of the public think that we work for our best interest and no one else’s, throw in mortgages as well, and now we’ll have a nice conflict soup to share all around. Now throwing back loan originating fees back at the client may be a great incentive….for those foreign nationals that don’t speak the language.

Actually in Pennsylvania we have what is called designated agency. The client employs a specific agent in the company rather then each seller being represented by the entire company. That way (in Pennsylvania at least) a listing agent in Company A and a Selling agent in Company B owe their agency obligations to the client who employs them and not to any client represented by the entire compant. When an agent is the designated agent of the seller, and he is working with a buyer, then our state agency laws allow for disclosed dual agency and spell out the responsibilities of the agent to each party. But I have to tell you I still feel that’s a minefield, no matter how careful you are. It isn’t a conflict of interest though since the agent’s obligations are in accord with the client’s interests if the client has decided that they wish to have the disclosed dual agency relationship – (the only potential conflict there is between the two clients – not the client and the agent) But that is a really small part of our business – most transactions involve more then one agent, and when they do not, more frequently the buyer client working with a listing agent will either agree to be unrepresented or wish to obtain another agent – if they don’t like either of those options, the disclosed dual agency (again in our state) does detail the obligations of the agent and explains where the conflicts between the interests of the buyer and seller might be

“I even have access to an automated LO in spanish and english I can hook you up with that loads right into your site that is handled online. Brian can simply log in and download the electronic disclosures… e a s y.”

It would take me 72 hours to have what Benn points out, for you, Ines

I don’t want to have this application available to everyone (or should I) because I don’t have the time to coordinate the loan aspect of the deal – but I will do it for our foreign nationals – any suggestions how to discriminate this process – Benn? Brian?

Hi Ines, I have been a little late in getting this link up https://www.vivareal.us/guias/comprar/guia-para-compradores-de-casa-extranjeros/capitulo-0. Things have been pretty hectic. The guide is written specifically for foreign buyers (native Spanish speakers). It outlines the process. Obviously it doesn’t solve the question posed here in this post as far as financing, but part of my goal with VivaReal.us is to build a community of professionals that can serve those foreign nationals (primarily Spanish speaking) wanting to invest in the US. There is such a huge amount of interest in buying real estate in the US. I have included an interesting article about cross border real estate investment https://www.businessweek.com/the_thread/hotproperty/archives/2008/01/foreign_investo.html

Any feedback on the guide would be greatly appreciated.

Ines, thanks for the feedback. For some reason there is a period at the end of the link. Here is the actual link https://www.vivareal.us/guias/comprar/guia-para-compradores-de-casa-extranjeros/capitulo-0
I think I understand what you mean. Social networks have enabled you to have a better idea of who the person is and how they operate their business (more transparency about their business standard) which helps you decide who you want to do business with. I agree that picking a name of some random professional from a list is ineffective. We are hand picking professionals to contribute to the network as well as opening it up to the public. We have a twofold approach to make the network really sound. 1) Giving real estate practitioners a bilingual platform to share their knowledge about their business and their local market. 2) In collaboration with NAHREP (National Association of Hispanic Real Estate Professionals) we will be implementing their Code of Trust https://www.nahrep.org/News/NAHREP%20Code%20of%20Trust%20Final.pdf
This means that those certified professionals (that take an exam and uphold a high standard of practice) will be designated as “trusted advisors”. VivaReal.us will highlight those professionals subscribing to the Code and consumers will have a way to report unethical behavior directly to NAHREP to maintain control and high standards.
As everyone knows, part of this mortgage mess has to do with people acting unethically or taking advantage of unsuspecting consumers. A few bad apples are all it really takes. The Spanish speaking community became a large target for predatory lending due to their gap in understanding and language barriers. According to Fannie Mae 1/3-1/2 of Latinos receiving a subprime mortgage actually qualified for prime. So a major goal of our project is to connect home buyers with people that not only speak their language, but also are doing the right thing. People like YOU;).
Anyways, this comment is turning into a post. I got a little carried away. I hope I am not too off topic.

Foreign Nationals…are the lenders nuts?? they are closing the door after the horse has bolted. The lending problems today were caused 2-3 years ago with poor lending practices. The property prices have gone down massively and the people buying today are part of the solution, not part of the problem. Backing out of the market now just compounds the problem as it takes forever to shift the inventory, especially as FN’s have never had a better time to buy (low property prices and a weak dollar…double whammy!). We need lenders who are brave enough to want to start making money again, not clam up trying to cover the losses which happened as a result of lending practices 2-3 yrs ago. By the way I have a FN (UK) client who has had an offer accepted at $190k on a property in Colorado, wants to borrow $135k and is absolutely clean. I had it AIP yesterday, but the lender advised me today they are withdrawing from the market place…another one bites the dust! anybody got any ideas…if so please email me at usa@jbemortgages.com

Its nice to see there are others out there getting frustrated with the lack of financing available to foreign nationals. I’ve spent the last 10 months researching this topic and luckily we have found solutions. Depending on the state, there are still lenders that are providing many financing options to foreign nationals. I actually speak quite often about the benefits of investing in the US as an international buyer, as it couldn’t be a better time. We had to create most of the forms and guidelines ourselves. Please email me if you are a realtor who needs financing for your clients at, id be more than happy to help. I can tell you lenders are starting to loosen up again. YEAH! finally!

To Continue, We have 25% down programs back on the marketplace. We have a 3 year adjustable starting at 4.5% ranging up to 5 year fixed terms. It has been a challenge keeping with in the conventional arena and not having to depend upon hard money lenders. We are on the west coast and most foriegn national lenders prefer to lend in Florida. With values on the decline, we are seeing a lot more foreign investing in California, Nevada, and Arizona. For Arizona, we have a 30 year fixed that is around 6.5%, which a lot of our canadian clients have been taking advantage of. This program is only available for second homes. FIABCI is a great organization to network with other professionals working with international clients. Their website is http://www.fiabci-usa.com
Hope this helps. 🙂

Thank you for the info John – where is Compass Bank based out of?

Ray, take a look at the comments above – there are a few good suggestions.

There is still financing available. Some general information on Foreign National Mortgages: Must have a valid passport, must have a US bank account, 10% to 30% downpayments (depending on the property), 3 year to 30 year fixed terms available and no US credit required. Please feel free to visit my website at http://www.globaloneinvestor.com for more information or contact me directly. You do have options and dont need to liquidate your cash.

Ines, there used to be many more options for Foreign National financing, Chase had an aggressive program when I originated for them but have since stopped the program. BBVA bought Compass Bank in September of last year to be their U.S. presence. They operate in 37 different countries and have a good handle on what is involved with working with international clients. They do not finance in the Miami area yet but they do originate in Central Florida and North Florida. We started a local international council in the West Central Florida region because of the amount of International business we should see in 2009.

RBC is still doing foreign national loans in your area to my knowledge. If Compass buys another bank that puts them in South Florida too I will let you know but if you find another source please update the site as I get contacted frequently by people looking for Foreign National loans in South Florida.

Mark,
Do you guys work with brokers? I have a great deal of loans to do for foreign nationals but have not found the resources to close this loans. Can you help me out with some info on this?