Finance for US Property

3 months on, finance approval seems to move slowly. 

Have spoken to a couple of brokers and they are witnessing domestic application volume increasing which is making some brokers less motivated to work with foreigners when there is so much domestic demand coming through their doors.

Still possible but we need to be a little bit more patient.

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Would you advise in investing in the US over Australia? 

Detroit is a terrible market and always has been. The fact that Detroit has gone broke is not a reflection on the whole US market. 

The are great vendor finance deals available in the United States especially in states like Florida

Engelo   sound like private money lender… as they are targeting areas state and federal lenders are not allow to target areas.. Its called Red lining  another words they wont lend in the hood…. Clinton came out with this legislation in the mid 90 called CRA  this is what forced lenders to lend in areas heretofore they would not lend in because they knew it was a foreclosure cluster.  So now private lenders will only lend in certain areas… State and federal banks are obligated to lend in all area however they have changed Underwriting to make it all but impossible to get loans in the ares the banks do not want to lend… SO IE if you make 100k a year and want to live in the hood you can get a loan   You make 20k a year have crappy credit and want to live in the hood your not getting a loan.

your probably talking about JP   him and I have been on panels together solid guy…. he sells his paper to an insurance company so its private paper with certain underlying guide lines.  he also has a 30 year product FYI…I highly endorse JP.  In my ever it to be humble opinion you will see rise in the hot markets… AZ  FLA  CA  OR WA NV ( las Vegas not Reno) Atlanta,,  alittle bit in some of the better mid west markets…

Hi Jay and Freckle,

Thanks for your comments.

Have a great day.

Decent financing is still out there. We recently secured an LLC genuine US bank financing for a 10 year term at near enough 5% with 30% down payment. Another client just bagged 15 years at  5% with 40% down payment. The catch for this particular program is that the loan amount has to be over 100K.

There are a few programs available to foreign investors with more popping up everyday. If you want to find one I'd suggest making a list of banks in the city state you want to purchase in and ring around. Try to get directly on the phone with mortgage specialists – the front office staff will have no idea how to help you and will probably just say "no". Be wary of time wasters though. There are a lot of mortgage brokers who tend to promise the world but then fail to deliver. A potential client just had someone from Wells Fargo promise a foreign investor loan and they are pursuing it aggressively. I fear it'll be a big waste of time for them, but will report back it they have any luck. Could be an easy avenue for many would-be investors

Freckle,  Blackstone is now securitizing their lease agreements to raise more capital.. So they raised capital to buy the asset then put a tenant in and wrapped up al lthe lease's and borrowed on them.. B Stone could be heading down a deep dark hole when rents fail to appear.. And anyone who has owned US rentals know that rents are anything but a certainty compared to AU and other countries.

Not in the US and maybe for a long time. The next GFC event will almost certainly hasten a change in the reserve currency from the US$ to a basket of currencies (incl the US$). That creates a huge problems for the US currency.

The US currency is seen as a commodity to facility global trade. The US can run deficits into the global system to supply the US$'s countries need to trade effectively. If the US$ is not needed then the trillions of US$ in the system become surplus and essentially worthless. You might get 10 cents on the dollar until the system rebalances … I'm not sure how it's going to work out but it certainly won't be good. Anybody holding US$ or assets in US$ will have a bad day.

If the US$comes under threat in this way then interest rates are likely to rise substantially (think mid 80's @ 22%) to mop up excess US$ liquidity.

Currently inflation is being misreported by the US government because if the true rate were published (in excess of 10%) then interest rates would have to rise substantially to contain inflation. There's no way they raise rates without going belly up.

It is very difficult to envisage any way in which a transition from US$ reserve status to a basket of currencies will play out. I can't see any way in which it will be good for investors. The upside is that the US economy would become more competitive by a significant margin. You might even see the US and China sort of change positions. China becomes a consumer and the US a manufacturer. God knows US manufacturing quality is streets ahead of the Chinese.

Interesting times ahead.

Not if you're in NZ…