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Mortgage Options for Permanent and Non-Permanent Resident Aliens

Mortgage Options for Permanent and Non-Permanent Resident Aliens
Rita Williams
Home.com Contributor

Is it possible to get a mortgage if you’re a permanent or non-permanent resident alien in the U.S.? Yes, it definitely is.

The term “alien” refers to foreign nationals who are not U.S. citizens but who live in the U.S. Typically, a permanent resident alien holds a green card, while non-permanent resident aliens may be in the country on a work visa and may not have applied for or received a green card yet.

In either case, you can buy a home in the U.S., as long as you can provide the necessary immigration and visa documents and you meet the loan criteria.

What's in this Article?

Purchasing a home as a permanent or non-permanent resident alien
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What types of mortgage loans are available?
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Potential hurdles for resident aliens seeking a mortgage
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FAQs
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Purchasing a home as a permanent or non-permanent resident alien

A resident alien is someone who legally lives in the U.S. but was born outside of the country and is not a U.S. citizen.

To obtain permanent resident alien status, you must have a Permanent Resident Card (Form I-551) issued by U.S. Citizenship and Immigration Services (USCIS), which allows you to live and work in the U.S. if you were born outside it. The Permanent Resident Card is commonly known as a Green Card.

You’ll also need a Social Security number from the Social Security Administration. If you are employed, you must pay taxes on income earned in the U.S. This works to your advantage when applying for a mortgage, because lenders require tax returns as part of your loan application.

Non-permanent resident aliens

Foreign nationals who legally reside in the U.S. but do not have a green card are considered non-permanent resident aliens. Those who do not have Social Security Numbers must have an Individual Taxpayer Identification Number (ITIN), issued by the IRS, according to Ashley Duenas, Assistant Vice President Product Training & Development at Fairway Independent Mortgage Corporation (Fairway owns Home.com).

Non-permanent resident aliens are usually on a temporary work visa. A person may be considered a non-permanent resident alien even if they have a work contract that secures their visa for several years to come.

Some of the typical identification documentation a non-permanent resident alien can provide would be:

  • A valid/non-expired Visa, or
  • An EAD (Employment Authorization Document known as Form I-766)

If documentation has expired or will be expiring within 1 year for EADs or 45 days for Visa, most lenders will require additional documentation.

What you’ll need to apply  

Mortgage lenders require several types of documentation when any borrower applies for a home loan. Primarily, they need to verify that the prospective homeowner can afford the monthly mortgage payments on their loan.

The proof of income requirements for permanent and non-permanent resident aliens are the same for U.S. citizens and borrowers from foreign countries. The biggest difference between the two groups is proof required for your immigration status.

A permanent resident alien should expect to show his or her current green card and Social Security card when they apply for a home loan. They can also show their passport with their stamped I-551 forms in lieu of their green card.

Non-permanent resident aliens will need to show documentation that they’re legally in the U.S., as well as provide proof of their income and ability to make their mortgage payments.

Lenders generally require the following financial documents.

  • W-2 forms (for the last two years)
  • Employers for the past two years (names and addresses)
  • Pay stubs for most recent month
  • 2 months of bank statements which include all pages
  • Tax returns for the last two years
  • A profit and loss statement (P&L) for the current year, if you’re self-employed
  • Proof of other income, such as alimony and child support
  • Investment account statements (savings, retirement accounts, brokerage accounts, etc.) to show proof of down payment and ability to repay the loan
  • Credit score or proof of steady payment of bills (example: utility bills, rent)
    • The credit score information is obtained by the lender using your social security number.

If you’re a non-permanent resident alien, you’ll need to provide additional documentation to verify employment authorization:

  • Employment eligibility (EAD), and
  • Visa status

Proof of employment for non-permanent resident aliens

Providing both proof of legal residence and work authorization along with employment are essential to buying a home in the U.S.

In fact, “any difficulties in getting a mortgage for non-permanent resident aliens are usually connected with a lack of credit history and residency status,” according to Gennady Litvin, an attorney at Moshes Law in New York. “Non-permanent resident aliens who want to apply for a loan will need to have a work permit, Social Security number, and a visa sponsored by the employer to prove legal residence.”

To legally work in the U.S., non-permanent resident aliens need an Employment Authorization Document (EAD), which you can obtain by filing Form I-766 from USCIS. EADs are more commonly known as “work permits.” You’ll also need a Social Security number. You must pay U.S. taxes, just as permanent resident aliens do, on income earned in the U.S.

Most mortgage lenders will also accept some work visa types instead of an EAD as proof of legal residency.

The following visas are commonly used as acceptable proof of legal residence for non-permanent resident alien status, although not all provide both legal residence and work authorization:

  • H series visa, including H-1B, H-1C, H-2, H-3 and H-4
  • E series
  • G series
  • L series
  • O series
  • NATO series
  • Canadian and Mexican NAFTA series

Most mortgage lenders will require that non-permanent resident aliens indicate an ability and intent to live and work in the U.S. for a minimum of three years after obtaining the mortgage, often through work permits or visas.

In addition, if you’re a non-permanent resident alien, your mortgage must be for a primary residence. In other words, you must intend to live in the home day to day, not use it as a vacation spot or second home, and it cannot be an investment property.

Check your work visa’s expiration date before you apply

If you plan to buy a home in the U.S. as a non-permanent resident alien, your mortgage lender will look closely at the expiration date on your work visa.

“If your visa is set to expire within a year, they’re going to look to see, when are you going to reapply? Are you going to reapply?” Duenas said. “It’s very good practice to make sure your [immigration] documents are not going to expire before your closing date.”

Having a visa that’s set to expire before your closing doesn’t disqualify you from getting a mortgage altogether. But it can delay your purchase timeline, because your lender will need the new document before they can close on the loan. That means you may miss out on properties where the seller wants a shorter closing timeline.

So if you’re planning to buy a house soon and know your visa will expire, talk with your employer or legal advisor about when and how to get it renewed as soon as possible.

“It’s very good practice to make sure your [immigration] documents are not going to expire before your closing date.”

Duenas said that your lender may also ask your employer for a letter of explanation stating that they intend to keep you on in your current position.

“That gives the lender validation that your work will continue after you apply,” she said.

Duenas also said that borrowers who have refugee or asylee status in the U.S. are automatically eligible to work here, and they do not need an EAD to apply for a home loan. However, they must show documentation of their status as an asylee or refugee in the form of a green card or work visa.

Proof of assets for permanent and non-permanent resident aliens

The rules for documenting income and assets are the same for citizens and for permanent and non-permanent resident aliens, Duenas said. However, there may be more steps involved for foreign nationals who wish to use assets outside the U.S. to qualify for a mortgage.

If you are using money in a foreign bank account toward your down payment, closing costs, or reserve requirements, the currency will need to be converted to U.S. dollars. “You have to still be able to qualify after the conversion,” Duenas explained.

Your financial documents may also need to be translated if they are not in English. Duenas said it’s typically best to work with your lender on this, as they may have translation partners they can refer you to.

For a standard mortgage application, your lender may require 30-60 days of bank statements. But for loans that use asset statements only, lenders may request 24 months of statements.

Additionally, all funds that will be used to qualify for the loan must be documented — you cannot bring cash to the closing. And the funds must be in a U.S. bank account when you wire them to your closing attorney or title company.

So, if you have money in a foreign account that you plan to use for your down payment, it must be transferred to a U.S. account and then transferred again, usually via wire, to the title or escrow agent when you close on the home. These transfers need to be documented and your lender can help guide you through this process.

What types of mortgage loans are available to permanent and non-permanent resident alien homebuyers?

Both permanent and non-permanent resident aliens are eligible for all standard loan types, including conventional loans, FHA, USDA, and VA mortgages.

In addition to proving immigration and employment status, non-U.S. citizens need to meet the loan program guidelines for credit score, debt-to-income ratio (DTI), income, and employment. Guidelines vary based on the type of loan you’re seeking.

The Federal Housing Administration (FHA), which is overseen by the Department of Housing and Urban Development (HUD), recently updated the guidelines for FHA loans so that Deferred Action for Childhood Arrivals (DACA) recipients are eligible for these government-backed mortgages.

FHA loans can be highly advantageous, because you can get an FHA loan with a 3.5% down payment. Also, the credit score requirements are lower than for a conventional mortgage.

In fact, some FHA lenders will accept nontraditional credit histories, such as records of steady utility bill payment for a year or more, rather than credit scores — which can be very helpful for resident aliens who haven’t established a U.S. credit score yet.

Potential hurdles for resident aliens seeking a mortgage

Some resident aliens may encounter challenges in obtaining a credit score, which is a requirement for many mortgage lenders. Generally, major U.S. credit bureaus such as Experian, TransUnion, and Equifax will have a credit score for anyone who has used credit for roughly a year (credit card, car loan, personal loan, and so on) and has a Social Security number.

If you don’t have a U.S. credit score, some lenders will accept a record of steady payment of basic bills, such as rent, gas, electric, water, and phone bills.

Some lenders, Fairway included, can also obtain an international credit report for you that they can use to qualify you for a loan.

Non-permanent resident alien FAQs

What is the difference between a permanent resident and non-permanent resident alien?

Permanent resident aliens have the right to live and work in the U.S. permanently, although they were not born in the U.S. and are not U.S. citizens. Permanent resident alien status is officially indicated by a green card (the common name for a Permanent Resident Card from U.S. Citizenship and Immigration Services).
 
Non-permanent resident aliens are also non-U.S. citizens who were born in other countries. They typically are on temporary work visas, and they have not applied for or have not yet received a green card.

Can a non-resident alien get a mortgage?

Yes, non-resident aliens can get a mortgage to purchase a home in the U.S. You will need to show official proof of your status, such as your EAD or other work permit. Mortgage lenders often will want to see that you will be in the U.S. for at least three years after obtaining a mortgage.

You will also need to show proof that you have enough money to pay your mortgage and that you are financially stable, just as all potential homeowners do. You will provide pay stubs, income tax returns, bank statements, and similar financial documents. Most lenders want to see records for at least two years of steady employment.

What documentation is needed for a non-permanent resident alien?

To purchase a home, you will need an EAD or a work permit from your employer. If your work visa expires in a year or so, you may need a letter from your employer saying that it is likely to be renewed. It’s possible that you’ll also need documentation such as a letter attesting that your work is likely to last at least three more years.

You will also need financial documents, such as bank statements, tax returns, W-2s, and records of investment and retirement accounts. Lenders usually ask for records indicating at least two years of steady employment. You’ll also need a Social Security Number or ITIN to work and pay taxes in the U.S.

What documentation is needed for a non-permanent resident alien?

To purchase a home, you will need an EAD or a work permit from your employer. If your work visa expires in a year or so, you may need a letter from your employer saying that it is likely to be renewed. It’s possible that you’ll also need documentation such as a letter attesting that your work is likely to last at least three more years.

You will also need financial documents, such as bank statements, tax returns, W-2s, and records of investment and retirement accounts. Lenders usually ask for records indicating at least two years of steady employment. You’ll also need a Social Security Number or ITIN to work and pay taxes in the U.S.

Take the next step

If you’re a permanent or non-permanent resident alien, you have several options for obtaining a mortgage to buy a house in the U.S., including conventional and government-backed loans. The next best step is to talk with a lender about which loan types may be available to you and what documents they’ll need to help you purchase your new home.


Some references sourced within this article have not been prepared by Fairway and are distributed for educational purposes only. The information is not guaranteed to be accurate and may not entirely represent the opinions of Fairway.

Fairway is not affiliated with any government agencies. These materials are not from VA, HUD or FHA, and were not approved by VA, HUD or FHA, or any other government agency.

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