It’s an exciting time to get a mortgage in the U.S. But if you are an Indian Citizen you might be wondering: Can I get a loan if I hold an Indian Passport? What kind of credit history do I need? Do I need a U.S. citizen to cosign with me?
In this guide, we’ll answer all these questions and more about obtaining a U.S. Mortgage as an Indian Citizen.
Can Indian Citizens Buy Property in the USA?
Absolutely! There’s no citizenship requirement for real estate purchases in the U.S., so Indian citizens can buy property in the U.S. as long as they meet the mortgage criteria for non-U.S. residents.
We’ve noticed that California is the top choice for Indian buyers, with 40% opting to purchase a U.S. property in the Golden State.
Before we jump into buying a property, it’s crucial to understand exactly how the mortgage system works in the U.S. for Indian citizens and the difference between the two mortgage systems.
What Are the Differences in Mortgage: USA vs. India
If you’re used to the Indian mortgage system, you might find new terms and products here.
In India, a home loan (or mortgage) is a secured loan with the property as collateral. In the U.S., the process is similar. The property is the collateral for the loan. The title of the property is recorded under the buyer’s name and securely recorded with the state and county the property is located in.
You must also decide whether you want a fixed or variable-rate mortgage. A fixed-rate mortgage guarantees a constant interest rate for the loan’s term. In the U.S., you can get a fixed rate for up to 30 years regardless of the age of the borrower. This is something very unique to the U.S. real estate market and allows for maximum yield opportunity for the property. A variable rate mortgage is normally fixed for 3, 5 or 10 years and then variable every year after, depending on the market.
The differences between the two mortgage systems:
| Aspect | The U.S. | India |
| Interest Rates | Currently, 6.5% is fixed, but it fluctuates from time to time. | Ranges from 8.15% to 11.80% p.a., usually not fixed. |
| Loan Tenure | Long-term mortgages (15 to 30 years) regardless of age are common. Most Americans prefer small monthly payments over a long period. | Similar in terms of repayment periods, which can also stretch up to 30 years but will be capped at age 65. |
| Credit Scores | America Mortgages does not require Foreign Nationals / Non-U.S. residents to have a FICO / U.S. credit score. NO U.S. CREDIT REQUIRED | A good CIBIL Score is 700 or higher. The closer to 900, the better your chances of approval. |
| Taxes on Property and Mortgages | Mortgage payments include property tax, principal, interest, and homeowners insurance. Mortgage interest is deductible to mitigate any income earned from the property. | Mortgage payments include property tax, principal, interest, and homeowners insurance. |
Eligibility Criteria for Indian Citizens
Good news to all Indian Citizens who wish to get a mortgage in the U.S.! You don’t need to be a U.S. citizen to get a mortgage here. If you have a green card and a social security number, the process is similar to that of U.S. citizens.
If you do not have a green card but have a social security number, you can use a work visa or a special employer-sponsored visa.
In the case where you aren’t staying or working in the U.S. – No Problem! As a company America Mortgages ONLY focus is providing U.S. mortgage financing for non-U.S. residents. This is our expertise. If you’re living and working in India and want to buy a U.S. property or refinance / cash-out an existing U.S. property you already own, America Mortgages is the best option.
Loan highlights:
- No U.S. credit
- No personal income
- Qualify on the rental income of the property
- All 50 U.S. States
- Minimum loan amount $100,000
- Minimum down payment only 25%
What Type of Mortgage Can Indians Get in the U.S.?
By now you’ve understood the differences and checked the eligibility criteria – great! Now if you are ready to start, let us tell you about the different types of mortgages available for Indian Citizens.
Foreign national mortgage loans
As the name goes, this is a tailored loan, designed for foreign nationals, that is people who aren’t citizens of the U.S. You don’t need a U.S. credit history to qualify and the down payment is only 25%.
CashFlow loans
Debt Service Coverage Ratio or DSCR loans are used exclusively for property investors. It measures the property’s ability to generate enough income to cover the payments. America Mortgages is the leader in this market when it comes to financing properties in the U.S. for non-U.S. residents.
Conventional Mortgages
These loans are the standard home loans, they aren’t government-backed. Offered mostly by banks and follows the guidelines set by Fannie Mae and Freddie Mac. Conventional mortgages require the borrower to have a U.S. credit score and a U.S. passport or Green Card to qualify.
Jumbo Loans
Jumbo loans are mortgages that are normally US$1,000,000 and higher. These come with different requirements since they are used to finance high-value properties. The down payment will likely be higher depending on the loan size.
Tips for a Smooth Mortgage Application Process
To ensure a smooth mortgage application process, consider the following tips:
- Ensure you have enough savings for a down payment.
- Consult with your America Mortgages loan specialist on the options available and your requirements.
- Provide all information required by your loan officer so your loan can be processed and approved quickly and easily.
America Mortgages can help you obtain a U.S. mortgage. As a company, our only focus is providing U.S. mortgage financing for non-U.S. residents and U.S. expats. If you’re interested in learning more, reach out to us at [email protected] or visit our website at www.americamortgages.com. Additionally, if you’d like to schedule a commitment-free meeting with one of our U.S. loan officers to explore your U.S. mortgage options further, you can do so using our 24/7 calendar link.
