Foreign National DSCR

A foreign national loan is a mortgage designed for borrowers who live and work outside the US and want to buy or refinance US real estate. Because these borrowers typically have no US credit history or US income, foreign national loan requirements rely on alternative qualification — at AD Mortgage, that means qualifying through the property’s rental cash flow (DSCR), documented foreign income or borrower’s assets (Asset Utilization).

A foreign national mortgage is any home loan made to a non-resident borrower. The DSCR version qualifies the borrower using the investment property’s income instead of personal income: DSCR = gross rental income ÷ proposed PITIA.

Key foreign national mortgage guidelines include: a valid passport and unexpired visa (or legal presence in the US as of the note date), 12 months of reserves (overseas assets allowed), one bank reference letter, and a 10% borrower contribution when gift funds are used. No US credit score is required — borrowers can qualify with no FICO, and DSCR below 1 is allowed with min FICO 680 or no FICO. Up to 75% CLTV on purchase and 70% on cash-out.

Yes. AD offers solutions for investment properties only, like DSCR Foreign National loan. Foreign Nationals can qualify with documentation for the income generated in their residence country OR just with the cash flow from the subject property.

Foreign National loas is intended to be used to purchase homes as investments, not primary residences.

They will need to be a US resident and obtain a regular mortgage.

No, borrowers do not need to have a US credit record in order to qualify for a Foreign National loan.

Borrowers should get the following documents ready before they apply for a Foreign National loan in the US:

• A copy of their passport
• A copy of their unexpired Visa
• A current credit report
• Proof of income for the prior 2 years and the current year
• If self-employed, an accountant’s income letter for the prior 2 years and the current year
• A copy of their purchase contract

These documents should be translated into English by a certified translator. Having all of these documents gathered before your clients fill out their applications can save you a great deal of time and hassle.

Yes. The following borrowers are not eligible for a Foreign National loan:

• Borrowers with diplomatic immunity or otherwise excluded from U.S. jurisdiction.
• Residents of any country not permitted to transact business with US companies are ineligible (as determined by any U.S. government authority).
• Irrevocable Trusts or Land Trusts.
• Borrowers less than 18 years old.

Yes, an experienced lender accustomed to working with Foreign National borrowers should be able to close this loan as quickly as a Conventional mortgage. And, because some of the income and credit qualifications are comparatively easier, it might happen even faster.

Interest rates are dependent on a variety of factors, but with Foreign National loan borrowers can expect to have an interest rate that is competitive with those offered to US citizens.

No, the borrower must have an active visa as of the note date or be legally present in the U.S.