Forums / Property Investing / Overseas Deals / Finance for US Property

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  • Profile photo of sonic81sonic81
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    @sonic81
    Join Date: 2013
    Post Count: 3

    Hi guys,

    I'm new to the forum but wondering if it's possible to get finance for US property (in the range of $60-$100k USD) if bought in a LLC.  I have a US bank account but no social security number.

    Thanks in advance.

    Profile photo of Texas Cash Cow Investments AustraliaTexas Cash Cow Investments Australia
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    @texas-cash-cow-investments-australia
    Join Date: 2011
    Post Count: 71

    Hi sonic81,

    For single family homes you will find it very hard as a foreign national to get anything but private finance usually having terms from 50% down and rates at 8.25%.

    As far as I know we are the only company that has access to a bank in Dallas that gives finance to foreign nationals. 30% down with a rate of 5.75% over 15 or 20 years. All you need is a Texas LLC & EIN in place….no SSN needed.

    Jayman
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    @jayman
    Join Date: 2005
    Post Count: 63

    Hi Sonic81,

    Do you have a particular location in mind? As it's definitely possible to get US Finance in that price range, and get good quality well located property as well.

    There are a number of claims to get all sorts of low rates, but some are through local banks and only lend locally, or in that state, or, they have certain lending criteria  that might not be that attractive, so you have to know what your paying for, and if the loan repayments include the property tax and insurance.

    I have been working very closely with a particular finance company that lends at 8.25% and for a 30 year period, also lending in a number of states, so you don't have to be concerned about refinancing in a few years.

    <moderator: delete advertising>

    Jeff

    Profile photo of Nigel KibelNigel Kibel
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    @nigel-kibel
    Join Date: 2005
    Post Count: 1,425

    Hi Sonic

    Finance is available at good rates in the 5s % in Florida for residential property and across America for commercial property which will include small apartment complexes. On commercial we can achieve at least 60% funding with higher amounts on more expensive property. This is a growing sign that things are getting better.

    Nigel Kibel | Property Know How
    http://propertyknowhow.com.au
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    We have just launched a new website join our membership today

    Profile photo of Richard TaylorRichard Taylor
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    @qlds007
    Join Date: 2003
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    As Nigel has mentioned standard finance is available in FL due to the influx of UK buyers.

    For outside FL you need to be having minimum loan of $100K

    Again i am unsure why you buy something out in the depths of nowhere when you could buy a quality investment in FL.

    Why not talk to Nigel and see what he can suggest.

    He has vast experience in the US market.

    Cheers

    Yours in Finance

    Richard Taylor | Mortgage Broker helping investors build their wealth thru property
    http://www.mortgagecapitalaustralia.com.au
    Email Me | Phone Me

    0-40 Properties in a decade with a unencumbered portfolio value in excess of $40M. Ask me for a copy of my API Interview.

    Profile photo of GnibblerGnibbler
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    @gnibbler
    Join Date: 2013
    Post Count: 1

    I am also looking for a lender willing to re-fi (through a HELOC-type loan) investment properties in Illinois. 

    The properties are generating positive cash flow and owned by US permanent residents/citizens who live here in Australia (no other US income besides rental income). We are looking to get the capital we used for acquisition back out to the investor, but still want to hold on to the properties long term for purposes of cash flow and appreciation. 

    We have looked at conventional lending sources, like the big banks, and generally run into trouble with the requirement that the rental income be stable for 2 years prior to lending.  As these acquisitions were made in late 2011, with rentals beginning early 2012, we don't have the income length that they are looking for.  Hoping to find some other lending sources that might have different guidelines. 

    TIA.

    Profile photo of FacilitatorFacilitator
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    @facilitator
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    Hi Sonic 81,

    Citibank USA will provide any foreign national including Australians with a one-off US property loan.

    Its a 4% interest with a 30 year term home mortgage and you need 30% deposit which you can have as cash or borrow in Australia from your property as a line of credit.

    We have two clients doing these one in Australia and one in Singapore. I would be happy to provide you with the citibank lenders name and contact details, she is in Houston Tx.

    Beyond that some bigger banks like Citibank and HSBC will do lending for higher amounts like $500K USD loans but they will do this on Australian property and at 2.1% yes 2.1%. You must be able to qualify for the premium loan though.

    In the US there are several state bank options, we deal with two texas banks that will lend to foreign nationals and a Georgian bank that also will lens.

    Rates are 6% – 7% and most are 30% deposit required and 30 year term. The rate is fixed for 3-5 year depending on the bank but you are free to refinance anytime to another bank.

    AVOID VENDOR FINANCE PROVIDED BY TURN-KEY OPERATORS – Stick to actual US bank loans with real terms and no trick interest rate hikes. If vendors are financing their own property then they are usually unable to get true bank finance as the property is 20-30% over-priced.

    Unfortunately the industry is rife with these operators, many on this forum which is why i try to stay off it…

    Let em know if you need any help navigating these shark-infested waters.

    Mark

    Profile photo of FacilitatorFacilitator
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    Gnibbler,

    Never heard of the banks requiring 2 years rental income certainly not the bigger ones. They are more looking liquidity from all sources. what they want to see in tax returns, income and wages and cash at bank. Also important is property equity be it in Australia or USA. The banks we are using will allow 70% of any rented property as long as it is tenanted.

    We are only dealing in Tx and GA looking at Tennessee and FL.

    Have you tried CITIBANK ?

    Profile photo of FacilitatorFacilitator
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    @facilitator
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    Loan Terms:

    These are important as the repayments will be higher and tax deductibility lower for the shorter terms upto 15 years. We recommend that anyone looking to maximise cash flow and after tax returns go with the standard 30 yr term.

    Rates are available for 4% – 7% on these 30 yr terms and 30% deposit in most states. shorter terms equate to a higher overall rate of payment and are meant to lure in investors.

    Mark

    Profile photo of Joel.MacdonaldJoel.Macdonald
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    @joel.macdonald
    Join Date: 2012
    Post Count: 52

    I am going through this citibank application at the moment.

    Still yet to be approved, but the lady seems to snowed under 90 applications right now. Everyone is starting to catch on

    Profile photo of Nigel KibelNigel Kibel
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    @nigel-kibel
    Join Date: 2005
    Post Count: 1,425

    There are more and more banks prepared to lend money in the United States especially  for Commercial property at rates of around 5%.

    I agree stay away from hard money lender good finance is becoming more widely available

    Nigel Kibel | Property Know How
    http://propertyknowhow.com.au
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    We have just launched a new website join our membership today

    Profile photo of sonic81sonic81
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    @sonic81
    Join Date: 2013
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    Guys thanks for the great info on this thread esp. regarding citigroup.  I'm a citi gold member so I'm in the process of speaking to them now.

    I'm open to vendor finance but my research shows as you guys have mentioned some properties are marked up 20-30%.  I'm a US property newbie how does one check to see if what they are selling is marked up?  Would you just ask for the address and go to zillow for last sold prices around the area and make a rough comparison?

    If they bought and are reselling to you at +30% how long does it take before you can see what price they bought the property for and what website can I check this on?  Thanks in advance.

    Jayman
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    @jayman
    Join Date: 2005
    Post Count: 63

    One of the most asked questions i get is how does a buyer know that they are paying the right price to start with, and that they are not getting ripped off, never mind any work that has to be done, or has been done, that is included in the selling price, even that can be questionable.

    Going to places like Zillow or in fact most online appraisal sites still don't give you the true pricing, and can in fact be very misleading.

    Over time in this business, a number of companies over here selling US property have been caught out adding / marking up the price by $20K-$30K or even much higher to the unwary buyer, and then the buyer also finds out that the property still needed a lot of money spent on bringing it up to scratch.

    You can go to the MLS sites  ( Multi listing Service ) and get the true pricing of what places like Banks, Courts, HUD Homes, etc, are really selling the properties for through various listing agents, and then check with Zillow, Trulia, etc, and they will normally give the same true current market prices on these mainly foreclosed / short sale homes.

    <moderator: delete advertising>

    As for the US Finance,  i get approached all the time from both private and institutional lenders, all over the place in the US, with all sorts of rates, percentage of deposits, and other lending criteria.

    Many sound really good…..on the surface, dig deeper, and what sounded a real good deal at very low rates, at maybe 70% lend etc, can be fraught with many dangers, and locked in terrible terms and fees etc.  The one company i have used for the past few years, and has also lent against Aussies using their SMSF, who have been terrific with my buyers, are not the cheapest, at 8.25% and 30 Year mortgage loan, etc, but are certainly one of the best i have ever come across, and this same company is used by a large number of US Companies selling property in many states to clients both locally and overseas, so they have a great track record.

    Knowing who you are dealing with in the US and their track record etc,, is part of any due diligence, and should always be included in the many questions you should be asking.

    Thanks for reading this message.

    Profile photo of KimberlyKimberly
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    @kimberly
    Join Date: 2010
    Post Count: 44

    I am about to close on a deal and got told that b/c I owned nothing in USA, then I could not borrow. So most interested to find out from "Facilitator" if there is an opportunity to do so. Already with Citibank.

    Thanks.

    Profile photo of Professionals Invest USAProfessionals Invest USA
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    @professionals-invest-usa
    Join Date: 2013
    Post Count: 7
    Kimberly wrote:
    I am about to close on a deal and got told that b/c I owned nothing in USA, then I could not borrow. So most interested to find out from "Facilitator" if there is an opportunity to do so. Already with Citibank.

    Thanks.

    Kimberly,

    Whoever told you this was giving incorrect information. The last client of mine who purchased in Phoenix got a loan at 5.08% with a 50% down payment from a local bank.

    Profile photo of FreckleFreckle
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    @freckle
    Join Date: 2012
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    Nigel Kibel wrote:
    With finance becoming more readily available in the United States it a good sign that the economy is improving. 

    Finance has always been available it just hasn't been as accessible due to higher qualifying criteria. The US govt has pushed the bar back down to subprime levels again so when the next GFC arrives we'll all get another go on the US boom bust merry-go-round.

    Profile photo of lrkaussielrkaussie
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    @lrkaussie
    Join Date: 2013
    Post Count: 2

    Hi Peter,

    Is there a minimum amount criteria for the loan? I would like to know more about your product

    Thanks and Regards,

    LRK

    Profile photo of Richard TaylorRichard Taylor
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    @qlds007
    Join Date: 2003
    Post Count: 12,010

    Finance in the US is and always has been available to Foreign National's however in most cases the US Bank's will not accept the type of security most Australian want to purchase which normally is in undesirable areas and the asset value is below the Bank's minimum.

    If you look at a multi unit block and the block is in the right area then you will fairly easily get 65-80% lvr.

    Have a word with the Freckle from the forum as he has a US Partner and specialises in multi unit dwellings in Florida.

    Cheers

    Yours in FInance

    Richard Taylor | Mortgage Broker helping investors build their wealth thru property
    http://www.mortgagecapitalaustralia.com.au
    Email Me | Phone Me

    0-40 Properties in a decade with a unencumbered portfolio value in excess of $40M. Ask me for a copy of my API Interview.

    Profile photo of jayhinrichsjayhinrichs
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    @jayhinrichs
    Join Date: 2011
    Post Count: 1,177

    2 year rental experince and history is one of the main underwriting guidelines these days… Cash out refi's are tough no matter the cirumstances.. Lenders got killed with these loans in the GFC.. tons of fraud

    Profile photo of Nigel KibelNigel Kibel
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    @nigel-kibel
    Join Date: 2005
    Post Count: 1,425

    With finance becoming more readily available in the United States it a good sign that the economy is improving. 

    The view of many of the banks is that the market has not bottomed and they are prepared to lend from 60% and up. The big thing holding the US markets back has been a lack of finance. So more funding with help with not only the overall economy but also the property markets as well. <moderator: delete advertising>

    Nigel Kibel | Property Know How
    http://propertyknowhow.com.au
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    We have just launched a new website join our membership today

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