Foreign National Mortgage in Florida

Who these loans are built for

Foreign national programs serve buyers who live abroad and want a home in Florida for their own use part of the year. Typical borrowers are second-home buyers from Canada, Latin America and Europe. Conventional U.S. mortgages expect a Social Security number, U.S. credit and U.S. income, so most foreign buyers do not qualify for them at all.

A separate product, the ITIN loan, is aimed at people who live and earn in the U.S. but use an Individual Taxpayer Identification Number instead of a Social Security number. If you already work in Florida, ask about ITIN programs. If your income and life are abroad, the foreign national loan is the usual fit.

Borrowing for a home does not create any immigration benefit. A visa is a separate process entirely, and EB-5 investor status requires $800,000 in a targeted employment area or $1,050,000 elsewhere, invested in a business that creates jobs.

How much cash you need at different price points

Down payment requirements for foreign nationals generally fall between 30 and 40 percent, and the lender sets the exact figure based on your documents, the property type and the loan size. Using Zillow values:

• Typical Florida condo, $262,592: about $78,800 to $105,000 down.
• Typical Florida home, $375,361: about $112,600 to $150,100 down.
• Typical single-family home, $396,809: about $119,000 to $158,700 down.
• Typical Miami home, $583,705: about $175,100 to $233,500 down.

Add closing costs on top. If you borrow, Florida charges documentary stamps on the note of $0.35 per $100 and an intangible tax of 0.2 percent of the loan amount. A $250,000 loan carries $875 in note stamps and $500 in intangible tax, plus title insurance, lender fees and prepaid insurance and taxes. Lenders also often want to see reserves left over after closing, typically measured in months of payments.

The documents lenders ask for

Gather these before you start looking, since collecting them from abroad takes longer than buyers expect.

• Valid passport, and a visa if you have one. Some programs accept buyers who enter visa-free.
• Proof of income from your home country: employer letters, tax returns, or business financial statements for the self-employed. Lenders may ask for certified translations.
• Bank statements covering a few months, showing your down payment and reserves.
• Credit references in place of a U.S. score: a foreign credit report, or reference letters from your bank.
• Source of funds. Anti-money-laundering rules mean the lender and title company will ask where the down payment came from and how it is moving to the U.S.

Properties lenders will and will not finance

The property can limit a loan as much as the borrower.

• Single-family homes and townhouses are the simplest to finance.
• Condos must usually be warrantable. Lenders review the association's budget, reserves, insurance, litigation and the share of units with owners behind on fees. Florida's newer condo rules have pushed some older buildings onto lender decline lists while they catch up on reserves or repairs.
• Hotel-style condos and buildings with heavy commercial space are often excluded.
• Insurance must be bound before closing. If the home is in a high-risk FEMA flood zone (A or V zones), the lender will require flood insurance as well as a homeowners policy.

For condo buyers, I ask the lender to review the building before you pay for an inspection. It saves money when a building turns out to be one the lender will not touch.

From pre-approval to closing, in order

• Talk to two or three lenders that write foreign national loans and compare down payment, rate, fees and how they treat condos.
• Get a pre-approval letter so sellers take your offer seriously.
• Make the offer with financing and inspection periods long enough for international paperwork.
• Inspect and insure. General inspection, wind mitigation, and a 4-point on older homes. These also drive your insurance premium.
• Appraisal and underwriting. The lender confirms value and your documents.
• Wire funds and close. Florida title companies handle closings by mail or remote online notarization. Confirm wiring instructions by phone directly with the title company.

Allow more time than a domestic loan needs. International documents, translations and wires slow each step.

Rules that apply to some foreign buyers

Florida's 2023 law SB 264 restricts property purchases by people domiciled in China, Cuba, Iran, North Korea, Russia, Syria and Venezuela near military installations and critical infrastructure, with broader limits for people domiciled in China. All buyers sign an affidavit at closing. If you are domiciled in one of those countries, check the specific address with a Florida attorney before you sign a contract.

Plan for the sale as well as the purchase. When a foreign owner sells, FIRPTA requires the buyer to withhold 15 percent of the price, with lower rates in some cases where the buyer will live in the home and the price is under $1,000,000. You recover any excess by filing a U.S. tax return, which needs an ITIN.

This isn't legal or tax advice. Talk to a cross-border tax advisor in your home country about how a U.S. mortgage and property are treated there.

Whether to borrow at all

Many foreign buyers compare a Florida loan against borrowing at home or paying cash. Cash closes faster and skips the condo approval problem. A Florida mortgage keeps money in your home currency and can make sense if you hold assets you prefer not to sell. Currency is the part buyers underestimate. Your payment is in U.S. dollars every month, so a weaker home currency raises your real cost even when the rate is fixed. Some buyers split the difference: a larger down payment, a smaller loan, and a payment they could cover from savings for a year or two if exchange rates moved against them. Rates and fees on foreign national loans are usually higher than on conventional loans, so the comparison should use the full cost over the years you expect to keep the home, including fees paid at closing.

Price swings also matter: the statewide index is down 0.9 percent over the past year and up 18.6 percent over five, and condos fell 3.9 percent in a year. If you send me your budget and down payment, I can show you the homes that fit before you lock in a lender.