Everything You Need to know about your Individual Taxpayer Identification Number (ITIN) and Home Buying

Buying a home is something that a lot of people strive for. In the US, it’s more than possible for you to buy a home even if you do not have a social security number. If you are a foreign national but you are not eligible for your own security number, then it may be worth looking into an ITIN number.

 

Further your Home-Buying Experience with an ITIN Number By:

 

  • Establish credit by getting a loan or credit card
  • Maintain positive rental payments for 2 years
  • Get on the ITIN mortgage ladder

 

The Home Buying Process


If you aim to buy a home in the US, then it’s necessary for you to obtain funding so you can qualify for a loan. If you want to secure a mortgage, then lenders will normally require you to have a social security number. If you are a foreign national, then you will need to complete your ITIN application. You will also need to establish some credit before you are approved. Your ITIN number will be required for when you complete your tax return as a homeowner. Take a look below to find out more about that.

 

Challenges you Might Face


One challenge that a lot of applicants face when they choose to apply for a mortgage is not being able to provide the right wage documents. A lot of employers do not submit any kind of documents if the worker is paid in cash.  This means that if you are in the US as an immigrant and you have an ITIN, you need to save up a huge amount of money and you also need to present documents such as your income payment history. This will help you to get a mortgage.

Some immigrants may be legally residing in the US, but not have an SSN. If you are an individual like this then you should have no problem. The process should go smoothly as you’ll have a solid credit history and a solid form of income as well.

 

ITIN Home Checklist


You have to be aware that the down payment for an ITIN loan will be much higher when compared to other loans. This amount tends to be around 20% of the house value. If your lender is being lent money from another source, then the down payment will increase. This may seem very unfair, but it is done to try and protect the lender if something should happen or if you are deported in the future. You will need to make sure that you have your ITIN number if possible. If you do not have one already then you need to apply for an ITIN number via the IRS.  This is done through the W-7 form.

When you have done all of this, you will then need to get a documentation of your credit history. Your credit history will be built up over time by simply making payments on time. It may be that you need to make payments for your auto loan, your credit card or anything else of the sort.

 

Consistent Rental History


It’s also important that you have a very consistent rental history. At the end of the day, a lot of ITIN lenders are more than happy to see 2 years of rental payments. This will help to give them way more documentation and it also helps them to justify the loan too. This will prove to them that you are in fact able to make way more future payments for your mortgage, so it’s an important point to keep in mind.

 

Employment History


Employment history is also very important. An employment history of the last 2 years is generally required.


Pros and Cons of Buying a Home with an ITIN


The pros of buying a home with an ITIN include the fact that you can get on the property ladder without needing an SSN. The cons include the fact that you may be spending more on your down payment and you will also need to show consistent repayments, along with your work history. This can be an issue if you are not able to provide this.


If you need help applying for your ITIN or if you require some support with your documents then you can easily contact us at Karim & Associates. When you do, you can then count on us to help you with anything you might need, including applying for your ITIN or even arranging all of your documents in anticipation of your property purchase.

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