How are u Aussies going with usa loan approvals?

Hey Luke,

Happy New Year to you mate.I hope 2007 brings you huge success and happiness.

In reference to brokers and getting loans approved, it’s hard to find a good broker who is willing to put in the effort on foreign national lending.

Ben is certainly one of them. I have not yet done a loan through him myself but do intend to give him a go with my two properties in the Valley.

I have used another guy based in San Antonio who is also very good and is actively researching foreign national loans.

The first loan seems to be the hardest to come through.

It is a patient game and those going through the process need to be patient as it can take. It seems to take between 4-7 weeks from the time of applying to everything going through.

Not much we can do about the red tape, but finding good brokers to deal with certainly helps.

Regards

Chad

Providing Turnkey Real Estate Investments In The USA.
We also provide Owner Finance in a new emerging market.

E-mail:[email protected]
web: http://www.gr8realestateinvestments.com

ON SKYPE AT: chaddylansimons

Thanks Luke for sharing your thoughts.

I’d just like to point out that our 2nd international deal is closing this week. Other than issues related to the property, there were no hold ups. Three more in procssing which are going well and should close by month’s end The lender has been working very easily with us and we have pretty much nailed down the process.

Here are some of my notes for things that are sure to turn up at some point while you are working with a broker here in the US. Please make sure that whoever the financing source is careful to review these points. Feel free to copy them off for them. Anyone who needs a 2nd opinion on what they’ve been told can feel free to contact me at no charge. Hopefully we wont hear about anymore hassles created by other brokers here in the US. Quite frankly, these loans are no more of a challenge getting approved than any other loan. Communication and organazation are a must between any referring source and the contacts they use here.

Social Security and Credit

No SS# or US credit needs to be established. However, if a ss# has been issued, the credit will need to be pulled. Most the time lenders will require 3 reference letters from Australian banks. The letter must show the client has an open account in which they have been extended credit with no late payments over the past 24 months. Some lenders may require less, but this can be addressed once I the loan is being worked up. We have been advised that this can be challenging as many banks there may not be willing to produce a letter becase of laws there. So far, everyone has been able to work with their banks there though.

Seasoning of Loans

Cash Out Refinances
If you already have an existing loan that needs to be refinanced, and you want any cash out over what the loan is, would be considered cash out.
If there is no loan on the property becasue you paid all cash or used a line of credit from another proeprty, then any type of loan you do would be considered cash out.

Generally clients will need to be on title for 12 months in order to pull cash out of the property and use the real appraised value. I do have 1 lender that will allow cash out using the new value after 6 months. I have others that allow for cash out immediately using the purchase price + documented cost of improvements as the value.

This is a really interesting option! If a client paid all cash for a property, that client can do a refinance within 90 days of closing to get just his cash back and the loan will be treated as a rate/term (below). The value of the appraisal will be used to calculate the lvr (ltv). The client will have to show that all of the funds for purchasing the property came from his assets (checking, liquidated stock, line of credit…etc).

No Cash Out Refinance(Rate/Term)
This is done when there is an existing loan on the property that needs to be paid off. No additional cash other than paying for the costs can be given out. The new value of the property can be used immediately if no cash is being taken out.

One additional important tip for those clients with current hard money loans. Properties listed for sale by the client in the last 6 months will typically not be eligible for CASH OUT refinances. The guidelines however do specify that exceptions can be made by the lender on these. Rate and Term (just paying off the existing loan) should be ok but the property has to be taken off the MLS and no longer listed. Lenders will require a solid explanation of why it was taken off the market.

Purchases
As a rule of thumb, most lenders will require the seller to be on title for at least 3 months. Some even require 6. It would always be advised to know the past history of the property as the lender will be watching for multiple flips. Clients can not be purchasing the property via an assignable contract.

US Bank Accounts

Many lenders will require that the client has a US bank account open. Especially, if funds are needed for closing. It would be advised that the client consider contacting a US bank to open an account in case this is ever required. A list of flexible banks has been provided by me on this site already. https://www.propertyinvesting.com/forum/topic/25245/2.html?sortfield=&sortorder=

Appraisal, Title, and Survey

We allow clients to choose the vendors they or their representatives have developed a relationship. The vendors are ran through a list to make sure not black listed. Both the appraisal and survey must be paid for upfront by the client. This is something that the client or their representative will need to make arrangements for. The costs from the title company can vary from state to state and are based upon the relationship a client has with that vendor. We asks for your help in getting all figures upfront, including but not limited to settlement fee, attorney fee, doc prep, wire, overnight, title insurance, etc. Knowing these immediately will help in structuring a client’s loan properly.

*If the title company is referred to us please remember that we are not in control of how flexible their services are in working with deals accross seas. Please make sure you ask them if they can email the documents to you. They will also need to be responisble for walking you through the package on what needs to be signed and notarized. This is not normally a service provided by US mortgage brokers.

Heating sources. We have found that some lenders will not finance a property that has no heating source. Space heaters are not acceptable. Window units that are not permanently framed in and hardwired are not acceptable either. We have discussed with the lenders in detail what is acceptable

Closing

As mentioned previously, any funds required to close the loan may require that funds come from a US bank account. Some lenders or programs will not allow for a power of attorney to be used. In these situations, the loan docs will be sent via the title company to the client. The client will need to have the package singed and notarized at the US Embassy or Consulate’s office and it will not fund until received back at the title company. *Some lenders will allow you to use other notary sources beside the embassy. Here is link in reference to the Hague Convention.
http://en.wikipedia.org/wiki/Hague_Convention_Abolishing_the_Requirement_for_Legalisation_for_Foreign

*Please remember that it takes about 3 days to overnight documents back to the US.

MISC

There are about 5 lenders that work flexibly with international borrowers. Each has a different set of underwriting guidelines so there are some very specific questions that need to be addressed before anyone can give you a good idea of options. LVR ranges can be up to 90% but most commonly we se clients choosing options at 80% because of the higher costs associated with the increase risk to the lender at 90%.

One lender available has concerns about an investor concentrating too much in one area using their financing. This would have to be addressed as a portfolio grows.

Minimum Loan amounts are going be $75,000. In some cases, we can make special exceptions down to ~ $50,000.

Ben Carmona
Mortgage Planning Consultant
“Specializing In Investment Loans”
First National Mortgage Sources
United States
314-914-6052 c
866-226-6309 f
On Skype at: Ben.Carmona-US.Investment.Loans
[email protected]
http://www.BenCarmona.com

Lending Nationwide Throughout the US

I just wanted to point out my experience with the mortgage docs being notorised.  In regards to the notary, I went straight to the US consulate and paid $170US to get all the mortgage documents binded and notarised.  Because I already had a US bank account where my deposit for the property was coming from, I paid it with my US debit card and didn't even pay the exchange fees.  The only issue I had was I had to fly in from Brisbane to get to the consulate in Sydney.  I got the docs sorted first thing in the on Monday morning, went straight to UPS at Mascot and they had them in San Antonio Texas on Tuesday their time.  I have US citizenship, so I don't know exactly how the consulate would treat an Aussie at the consulate, but I don't think it would be much different if you where just getting some docs notorised.

In regards to Ben Carmona, I will never do another deal in the US without him.  I have found his service essential for success.  He is tenacious to the point of immortal when it comes to solving problems that arise during the process, very professional even during high stress, (and let me tell you, we had some zingers on the last deal, none of which were of Bens doing) and unbelievable when I comes to response times to emails and questions.  When you live on the other side on the earth, it is sometimes hard to get a reply to an email with in 12 hours let alone 12 minutes which was the average for him and his counterpart Chrissy, who bears a large part of his success. 

Give me an email I can send you some details the consulate sent me with regards to the notary.

tall2z