Our client is a lawyer for a U.S. internet company in their Singapore office. They saw our flyer at the American Club and reached out to learn more.
How We Helped
The only thing we had to say is that we offer the same programs as you would find in the U.S., and that there’s a good chance we could even find something lower.
The fact that he could meet us in person already convinced him to use our services.
An adjustable-rate mortgage (ARM) refers to a mortgage with variable interest rates, which change regularly after an initial period. It fluctuates with the market interest rates, offering either a financial gain or loss to the borrowers. This is in direct contrast with the fixed-rate mortgage rules that impose a fixed interest rate for the entire repayment period.
Each ARM loan has an introductory period from 3 to 10 years where the interest rate stays lower than that of any fixed-rate mortgage. It’s possible to save a lump sum of money if you can settle the loan within that primary window.
After the initial fixed-rate period, an ARM’s interest rate will depend on the current market rates, meaning the rates can rise or fall over the mortgage’s remaining course. The lender will revise the rate at regular intervals, possibly once a year, and adjust it to the current market rate until the end of the term. To avoid paying extra money in rising interest, you can either sell the house or refinance the loan.
America Mortgages offers standard 5 and 7-year adjustable-rate mortgages (ARM) that you can qualify easily without going through much paperwork. You can also refinance if your home’s market price is at least $150,000 or pull out cash of the home equity.
An ARM might be the right choice if you can pay the loan off during the initial cap or don’t plan to live in the same house for your entire life. Ask the lender about the loan’s margin, the factors related to rate changes, and the intervals of rate changes to see if you can afford the calculated monthly installments.
A fixed-rate mortgage keeps the interest rate fixed throughout the loan term. This is the direct opposite of an adjustable-rate mortgage (ARM) that changes the interest rate regularly.
America Mortgages offers various fixed mortgage loans ranging from 15 to 30 years. Regardless of the length, the rate in all of them remains the same for the entire period.
In the case of a fixed-rate mortgage, if you purchase a home with a 15-year loan and your monthly payment is set at $1,500 in a fixed interest rate, you will be paying exactly this amount throughout the entirety of the loan.
People with a budget who do not want to deal with the sudden surge in interest rates will find this mortgage type ideal for them. However, these borrowers will not be able to take advantage of a drop in the interest rate unless they choose to refinance to modify their terms. A fixed-rate mortgage is also a good option for people who intend to live in the same house for the rest of their life. By paying a small monthly amount, they can eventually own the house when the mortgage period is over.
America Mortgages (www.americamortgages.com) is Asia’s only overseas mortgage company with Direct Bank Programs for Foreign Nationals and Overseas Expat to purchase or refinance residential property in the U.S.
I am a Hong Kong citizen and what’s happening now is heart-breaking to watch unfold. Hong Kong’s cultural identity, fortitude, and integrity are all being tested, and regardless of whose side you are on, one thing cannot be disputed – Hong Kong is not the same as it once was.
Previous Migration Trends
Hong Kong is no stranger to phases of migration. Starting in 1967 and lasting almost 10 years, social instability was wide-spread, with riots all over the small island city. Many Hong Kong citizens moved to South East Asia, South Africa, and even as far away as South Africa. Towards the end of 1984, when the “Handover” to China from the U.K. was officially signed, it was the beginning of the largest outbound migration Hong Kong has ever seen. At the time, the U.K. government did not offer passports to those born in Hong Kong as it once did. Then just a few years after, in 1989, the Tiananmen Square event happened, and Hong Kong citizens migrated en-masse, primarily to Commonwealth countries such as Canada, Australia, and New Zealand and, to a lesser extent, the U.S.
The Numbers Were Staggering!
Some estimate total emigration was up to 1 million during this period, with the peak between 1988 – 1994 at 330,000. That is about 20% of the entire population of Hong Kong in the 90s! Other research shows that an estimated US$4.2billion of outbound investment flowed to Canada during this period.
Why Is This Time Different?
What is different this time around is that back then, the “Handover” was relatively uneventful, and most Hong Kong-born emigrants returned home, a phenomenon known as “香港回流潮” or Hong Kong Returning Tidal Flow.
Fast-forward 20 years to today, and the landscape is very different. Every conversation with friends, colleagues, and family, Every news channel, Every newspaper – it all revolves around the protests. Hong Kong is emotional, it’s tense, and its energy is visceral. We now have a small glimpse into what the future may be like, and it’s different from the landscape during the Handover.
Folks Are Looking To Move!
Hong Kong has the most expensive property prices globally, and the market has increased consistently for 30 years with a few pullbacks – Asian Currency Crisis 1997, SARS 2003, G.F.C. 2008, to name a few. Meanwhile, the H.K.D. is pegged to the USD, so being able to cash out your Hong Kong property to purchase homes in the U.S. is starting to make a lot of sense. It’s already happening.
Year
Number of P.R.’s Issued to H.K. Citizens
2016
1,360
2017
1,360
2018
1,525
Other Destinations
Canada issued permanent residency for Hong Kong Citizens:
– San Francisco: home prices fall first time in 7 years
– Manhattan: Slowest 1Q sales since 2008
– Vancouver: down 9.6% from its peak in June 2018
– London: down 20% from its peak in 2014
– Sydney: down 15% from the peak in July 2017
Case Study: U.S.A.
The reasons why the U.S. attracts the most Foreign Purchases of Investment Property:
– Education – “Something for Everyone” Most universities in the world. The U.S. has approximately 5,300 colleges and universities in the world vs. 2,600 globally. That is a staggering 20% of all colleges and universities in the world!
– Evidence Supported Top Foreign Buyers in the U.S. in 2019: China $13.4bn Top Destination (more below): Florida (20%); California (12%); Texas (10%), Arizona (5%), New Jersey (4%)
Here is just a small sample in (no particular order):
Location
Rental Yield
Home Value Increase
Arlington, Texas
7.5%
10.3%
Columbus, Ohio
7.9%
9.2%
Las Vegas, Nevada
5.3%
15.9%
San Antonio, Texas
6.4%
8%
Orlando, Florida
5.7%
10.7%
** Did you know Orlando is the most searched city in America for Chinese real estate investors?
Since June 15, 2019, America Mortgages has seen a steady increase in loan inquiries from Hong Kong, with about 70% of them in the process of an actual home purchase!
Location
Enquiries
Loan Processing
U.S.
12
10
U.K.
8
5
Canada
8
7
Australia
6
3
Japan
6
4
Hong Kong is an amazing city, and it has provided so much, for so many, for so long.
However, Hong Kong, just like any other country, is not immune to domestic turmoil, and you have to wonder if this current Migration Wave is different from the others?
“There is nothing wrong with being prudent and diversifying your investments aboard.”America Mortgages Partners
America Mortgages has bank loan programs that are easy to qualify for. We can close loans in 30 days with many loan programs not requiring any income proof or the need to leave Hong Kong. Overseas Expats and Foreign Nationals to Purchase or Refinance.
Principal refers to the initial mortgage amount taken against the property you mortgaged. When you obtain a mortgage, it comes in two parts — principal and interest. The principal is the amount that you borrow from the lender, and the interest is a percentage of that principal amount charged by the lender as the cost of borrowing that money. When repaying, you have to pay both the principal and the interest.
For example: if you borrow $300,000 from a lender to buy a house, the principal of your loan is $300,000. At a 3% of annual interest rate, it will add $750 of interest balance per month to the principal balance. If you repay $10,000 as a monthly installment, the lender will cut off $750 as interest, and the rest $9,250 will pay off the principal balance. So, after one month, your loan principal will be 290,750. With each monthly installment, the principal balance will be reduced.
If you find it difficult to calculate the balance principal, interest percentage, and other fees, check the loan’s monthly statement. Our lenders will provide you a breakdown of all the numbers. It will show how much of the monthly installment goes toward paying off the principal balance and interest.
A bigger loan comes with a bigger interest rate. One way to avoid paying extra money is to pay off the loan faster by making additional payments with every monthly installment. Doing so in the case of adjustable-rate mortgages will save you plenty of money.
With America Mortgages, you can get anything between $150,000 and $5,000,000 and a choice from various paying off options.
A pre-approval denotes an official letter from the mortgage lender outlining the maximum mortgage amount they are willing to lend you. It’s not a commitment but only a rough estimate of the loan that you may borrow from that organization, the possible interest rate, and the monthly installment figure.
You can get the pre-approval document by filling up a loan application. The lender will ask you to submit some paperwork, including pay stubs, credit check, bank account statements, tax returns, and W-2 statements. An officer will look into the information provided and give you a written statement detailing the mortgage amount you are qualified to borrow.
A pre-approval does not guarantee the approval of a loan. It just means that the lending company has looked into your assets and other aspects of finances and chalked out the sum of a loan against that credit history.
At America Mortgages, we approve over 97% of all applications. Some of our loan programs don’t even require verifying the applicant’s income! Mortgage pre-approvals have an expiry duration, ranging between 30 and 90 days, depending on the lending company. Meaning, you will need to find a home and apply for the loan within that expiry window. Upon the pre-approval document’s expiration, you will need to apply for a new one that may affect your credit score a bit.
A pre-approval solidifies your financial stability and seriousness to the house seller. You can stand ahead of other potential buyers in a competitive market. This will particularly help first-time homebuyers to convince the seller that they are ready to put in an offer. Some people confuse between pre-approval and prequalification. However, the latter does not have much credibility since it does not involve a thorough investigation into your incomes and credit score.
An existing client referred this client, and he reached out to us to enquire about our U.S. citizen mortgage programs as he thought we only offer Foreign National mortgages.
How We Helped
How surprised he was to hear that U.S. Expat loans are half of our business. Since we are Expats ourselves, we know the exact issues our clients face and have a roadmap on dealing with them – Non-U.S. income, weak FICO score, and so on.
When you acquire a mortgage, the lender divides the repayment schedule into several monthly installments over a fixed period. Amortization is the process of spreading out the mortgage over multiple years and into a series of fixed payments. The total mortgage amount, including the principal balance and interest, is supposed to be paid off with the last installment.
As a borrower of an amortized mortgage, you need to repay a specified monthly amount that pays off a portion of both the principal and interest. After every installment, the total loan balance decreases and finally gets paid off with the last payment.
For example, if you obtain a $20,000 amortized mortgage for five years, the lender will divide it into 60 monthly installments, including the principal and the interest amounts. Presume you need to pay approximately $377 per month and respectively $294 and $83 go into squaring off the principal and interest. Then, it will be $295 and $82 respectively in the next month. Over the loan term, the amount of principal payment will increase, and the interest will decrease (although the monthly installment will be the same).
At America Mortgages, you can enjoy an amortization period longer than the mortgage term in the case of commercial loans. For instance, if you take a loan for ten years, the amortization period could be 30 years meaning the monthly installment amount will be similar to a 30-year loan.
If you are to repay this amount over 120 months at $1,000 per installment, the rate will continue for 119 months. In the last month, you will pay the remaining balance ($81,000 in this case) by one balloon payment.
Amortization is available on fixed-rate mortgages and home equity, personal, and auto loans. You won’t get this facility on credit cards and interest-only loans.
As a U.S. real estate investor, investment mortgage loans can be very beneficial to you. America Mortgages focuses specifically on these types of mortgage loans. There are several programs on hand that make it possible for borrowers to get a mortgage to invest in real estate.
Some of them are better than others, but they can all help you out in some way. If you are considering getting a mortgage, here are a few advantages that you can get from an investment mortgage loan.
Advantages
Use other people’s money – The biggest advantage of using investment mortgage loans is that you get to use other people’s money. Many financial experts have said that you should use other people’s money whenever you can. When you get a mortgage, you only have to put up a certain percentage of the property’s money, but you still get to benefit from owning the whole property. You get to take advantage of the property’s appreciation, and you get to use it for whatever you want. This allows you to hang on to your capital and use it for other investments.
Reasonable interest: With most mortgages, you will be able to get a very affordable interest rate as long with or without a U.S. credit score (FICO). When you get a low-interest rate like you can with an investment mortgage, it can save you a substantial amount of money. For the cost of the loan, it is usually well worth it to get a mortgage instead of using your funds. Hang on to your cash and use it towards additional investments.
Easy approval: With an investment mortgage, you will usually be able to tell whether you are approved relatively quickly. America Mortgages has pretty cut and dry standards when it comes to getting you approved for an investment mortgage. America Mortgages has loan programs for U.S. Expats with or without U.S. credit. We understand that living abroad often changes factors and your ability to borrow in the U.S. Our loan programs are tailored towards your exact situation.
Not a U.S. citizen, Foreign National, or considering relocating abroad for work or school? We can help. Our Foreign National / Non-U.S. citizen mortgage loans were created for these situations. Qualify with No U.S. credit. No U.S. residency. No income verification. It’s not simple, but we have it down to a science with our expertise in this market. You will know where you stand and if you will qualify within a reasonable amount of time.
Increase your reach: With the use of investment mortgages, you can increase your investment power. As you grow, you can keep buying more and more property. In Asia, where property prices have increased, and square footage and yield have decreased, finding an affordable investment outside your home country makes sense. Many people would not be able to purchase property otherwise as it usually takes a significant investment. You can keep picking up more and more stuff as you go.
Build your net worth: Hong Kong, Singapore, Shanghai, and other large Asian cities have cooling measures to stabilize a fast appreciating Real Estate market mainly due to outside investment and the lack of affordable Real Estate options. Being able to build your net worth on a global scale gives with a reasonable mortgage loan that eventually you will have all of the property paid off gives you the same opportunity as anyone else regardless of your passport. You are free to do what you want with all of the property. If you had to rely on your funds for all of this, much of it would not be possible.
The Verdict
Using an investment mortgage can be a great way to get involved in the real estate investment market. Many people have gained considerable amounts of wealth through the use of real estate investment. Therefore, if you are considering getting involved in the field, you should definitely take advantage of investment mortgages. The advantages that you will receive as a result of using them will help you in a number of ways. If you can qualify for one, it makes a lot of sense financially. America Mortgages’ primary focus is helping non-U.S. citizens and Expats obtain prime, quality investment mortgage loans not only in the United States but on a global scale.
America Mortgages Inc. is a mortgage broker focusing only on U.S. Expats and Foreign Nationals living overseas. We offer over 150 U.S. bank and lender programs direct to our international clients. America Mortgages is wholly-owned by Global Mortgage Group Pte. Ltd. an international mortgage specialist based in Singapore.
