Understanding ITIN Loans | Dan Biron

Understanding ITIN Loans

Many non-citizens living in the United States have dreams of homeownership.  Consistent with Fannie Mae and Freddie Mac guidelines, most traditional mortgages offered by banks require that applicants to have a green card or work visa and have a social security number.  Traditional applicants with a social security number typically have an easily verifiable credit history that banks consider to present a lower risk of default.  However, some will be pleased to discover that homeownership is not only possible, but quite common, with ITIN mortgage loans.

What are ITIN numbers? 

Normaly people who do not meet the residency requirements needed for a social security number can obtain an individual tax identification number (ITIN).  Both resident and nonresident workers can obtain ITIN numbers for tax purposes.  An undocumented worker who wishes to obtain a mortgage may apply for a mortgage using an ITIN number instead of a social security number.

How are ITIN mortgages different from conventional mortgages?

The biggest difference between ITIN mortgages and conventional mortgages is that ITIN mortgages have much more flexible credit requirements.  Since non-residents do not have social security numbers and therefore do not have an established credit history through the three major credit reporting bureaus, banks offering ITIN loans accept alternate forms of credit history such as utility bills and credit references (although everyone's individual situation can be different).  The ITIN number itself is useful in establishing the applicant's identity and along with cell phone numbers, addresses and bank statements, can be used to create a credit profile of the applicant.

Aside from the residency and credit requirements, the application process for an ITIN mortgage is quite similar to a conventional mortgage.  Borrowers typically have to demonstrate that they have been employed for at least two years in the same line of work and provide two years of tax returns.  Because ITIN mortgages are viewed as more risky, applicants are required to put down higher amounts down.  While United States citizens can obtain FHA mortgages requiring as little as 3.5% down, borrowers for ITIN mortgages typically have to put down at least 20% down and have at least three months of reserve payments. 

How common are ITIN mortgages?

According to the Migration Policy Institute, nearly a third of non-residents own homes in the United States.  Further, the longer an non-resident lives in the United States, the more likely they are to own a home, according to the Pew Hispanic Center.  Approximately 45% of non-residents who have lived in the United States for ten years or more own a home. 

Where can I find a lender who issues ITIN mortgages?

Equity Prime Mortgage offers ITIN home loans, and has many Spanish-speaking Mortgage Loan Officers to help the process smoother for homeownership.  Equity Prime Mortgage was founded in 2008 and has a proven track record of helping the Latino and Hispanic community since its founding.  Since our company is a direct lender, the company is not constrained by the strict lending guidelines that hamper traditional banks.  Contact us today if you're interested in getting more information about ITIN loans or give us a call at (877) 255-3554.