Jools-Ann

come talk to me We moved to GA in September from the UK and have just successfully closed on a house purchase. But beware, to get a mortgage with no US credit history is long and drawn out and draining but it can be done!! Don't give up. Here's a few pointers:-

You will only get approval via a large bank, Wells Fargo approved us, Sun Trust were also on the case.
You will need mega amounts of historical data (we thought we were going to have to give DNA samples as there was nothing else left to give ) Buy a good scanner and printer too!

Seriously you will need at least two years of payslips, UK mortgage data (we gave 10 years worth!), UK utility bills going back two years, proof of residence in terms of green cards, rental agreements etc, proof of payment of bills in the US, US payslips (we had only had jobs for a month when we started). We even had conference calls with Wells Fargo, Virgin One and our utility companies based in the UK. you will also need UK and US bank account information.

if you can, before you come over, obtain your UK credit report and rating from Equifax, it might help. We didn't have ours.

Be prepared to keep submitting additional data as the time rolls on. Our actual mortgage offer took over 3 months to obtain!! We had over 60% deposit too and both me and my husband have very good jobs, it counts for little unfortunately in this process.

We didn't have to take a ridiculous interest rate either, we locked in at 4.25%

I would also recommend getting the whole thing in place or imminent before making any offers. We lost out on two houses as a result.

thebruge

New to the forum, first day, so hi! Firstly congrats on the house!!!

Thought I would chime in here as if I was reading this post and didn't have a house I would be a little worried about the process. But I moved to the US on Nov 1st last year and closed on my house on the 28th Jan. I actually got my mortgage in more or less 60 days.

I will agree that you have to be ready to give over a lot of info. But its far from impossible. We bought our house outside of Raleigh, NC. We did not have a house previously, have never had a mortgage and had only 10% deposit. With a bit of work and a great mortgage advisor we got it sorted in what I think is no time, and got the house we initially wanted.

In the end we got a FHA loan, which means we could put down as little as 3.5% deposit, there are some conditions surrounding it, but if you meet them its a great way to start, we locked our rate at 4.65%, which I was pretty happy about.

I had my UK credit rating before I left, but that is really not a lot of use to be honest. But what we did have was Equifax US confirm my credit history in the UK via a series of conference calls with me, them and the 3rd party there were querying. Not a big hassle, most financial institutions will help out and I think it only added about $200 to our closing costs.

I didn't have to provide any utility bills, although they did want renting history for at least a year. Obviously they did have to confirm my working, visa and SSN statuses, but these are all pretty easy. The other main thing is to prove where the deposit came from, even with the help of my family as a gift for some it this did not make things that more complicated.

My advice to anyone wanting to do this is before you get set on a house, speak to a mortgage advisor, get everything more or less set and then go shopping. It was tough, I have never scanned so many documents in my life but it's very do-able.

As with Jools-Ann if you need some help just PM me, and if you're in the Raleigh, NC area and want a Real Estate or Mortgage guy I know 2 great people!

NatashaB

We managed it also - FHA minimum deposit of 3.5% and a rate of 4.5% with BOA. If it had dragged on another week I would probably have burnt the mortgage advisor's office to the ground as I was so tired of the constant demands for information, but I am also well practised at scanning now!

As someone else has said - make sure you keep a full paper trail of where the money came from the deposit. Luckily HIFX were extremely helpful and provided us with a letter containing full documentation of sort codes/routing codes that the money was sent from and to - a printout of our HIFX account summary and bank accounts wasn't sufficient.

Luckily we were buying the house we were already renting and the owner was happy to continue letting us rent when the mortgage process took a little longer than expected.

Jools-Ann

Actually TheBruge makes a good point, my post may appear a little worrying to some but it is an honest account of our experience and the process may vary state to state.

One thing I did forget to mention is that we didn't want an FHA mortgage, we wanted a fixed rate one that we can pay off more against than just the monthly payments (I forget what it's called) so maybe that's another reason why ours took such a long time and they wanted our life history

Like Natasha, we were also ready to burn the mortgage advisors office to the ground if it had gone on any longer and it didn't help that he got thrown in jail for two days, making us miss our closing date!!! He did keep the momentum going though and got on the underwriters case. Make sure you do get a good advisor. We had a couple give up on us because the process is complex and long, and one told us we didn't stand a chance of getting a mortgage unless we got two years credit history first!

fatbrit

Only is a sweeping statement. Also be aware that when you mention Wells Fargo, you're dealing with a huge bank with many arms. The WF mortgages available through the WF home mortgage arm is different from what you would be offered by a private broker accessing WF mortgage products. Similarly, if you're a Private Banking customer, you're going to be offered totally different products from those whose only welcome mat is the sub-prime arm, WF Financial.

Seems to imply erroneously that FHA mortgages have obligatory PPPs. They don't!


Best primer for USD mortgage products: mtgprofessor.com

Jools-Ann

FatBrit my comment may well be a sweeping statement, but that's what we were told more than once, that we would only get approval via one of the large banks and that was the case, Some independents just told us no, come back when you have a credit history. We went to a couple of independent advisors who did start the process and then said no, we can't do anything for you, stick with the big banks. This may also be a generalization too but the independents we spoke with were out of their depth when it came to dealing with our situation.

I've no idea what your comment about PPPs means so can't comment on that. I was implying nothing with regard to FHA mortgages per se, just stating that we didn't want one and wanted one that was fixed for the term with additional payments allowed on the principle.

fatbrit

And FHA mortgages can be....fixed for the term with additional payments allowed on the principle. Your reason for rejecting an FHA mortgage makes no sense.

thebruge

Mine is fixed for the term, but don't have a big issue with that. Don't see rates going down a lot to be honest. But there are no penalties at all for me paying mine off early. If I had all the cash tomorrow there would be no issues. I can make as many additional payments to the principal as I like.

My mortgage was through a smaller lender, I did actually speak to WF, but they wanted 20% which I couldn't do.

1chumly

Glad to hear you got the mortgage. It can be nerve-wracking. You are absolutely right about the paperwork, I really did think they were going to ask for my first-born at one point!

We got a mortgage in October (took about two months) through a mortgage broker who was brilliant. We did not want to deal with big banks and we didn't. We also got an FHA 15 year 4% fixed rate with 3.5% down with the ability to make extra payments which we have been doing. We were approved for a 30 year note at first but then was approved for the 15 year which was much better.

We had no credit history here, and not working for a few months before arriving here so that really added to the paperwork needed. My husband had only been in his job here for 4 months too so take it from me, it can be done! Not fun, but we did it and we got the house we wanted.

Jools-Ann

We rejected the FHA purely because we didn't want to go that route if we didn't have to. I apologize for the misleading sentence that implies we rejected it because we couldn't pay extra or fix the rate. I worded it wrong.

NatashaB

I'm curious to know what the negatives are with FHA mortgages. I have heard a lot of people talk about them in an 'only if you have to' type way. I'm not sure whether we are able to overpay on ours but the rate was pretty competitive (not the best on the market, but preferable to pouring more money down the drain every month renting) and I think there was a couple of hundred dollars in arrangement or inspection fees or something, but it all seemed pretty good to me.

fatbrit

Can be more difficult to remove mortgage insurance. (Note that this is only valid if you put less than 20% down.)

Generally, stricter standards required for the property you're buying in terms of price, suitability for living, etc.

Most of the rest is snob value since for some strange reason the FHA has received a label as being a mortgage for the poor. Much as Obama is considered a socialist by large numbers of the uninformed.

thebruge

As for the insurance we were told, it's mandatory for the 5 fives years due to it being FHA and under 20% down-payment. As for most of the other points raised by fatbrit we were told the same.

As for the poor persons mortgage i've not heard that, but I can see how some could take it that way, if there are that way inclined. It's more of a first time buyers mortgage I would say.

fatbrit

Yep -- it's the five years that's the main issue. Although most would have to really pile on the principle for it actually to become a cost factor.

If an FHA suits, take it! People looking for a mortgage should neither rule it in or out.

Michael

The main reason that FHA is easier to get is that the government backs the loan and it is usually sold to Freddy Mac or Fannie Mae.

Conventional mortgages usually require underwriters to approve a loan. Although conventional loans can also be sold to Freddy Mac or Fannie Mae, the loan has to following the rules for Freddy Mac or Fannie Mae.