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-   -   USA MORTGAGE (https://britishexpats.com/forum/usa-57/usa-mortgage-707531/)

heather123 Mar 1st 2011 5:33 pm

USA MORTGAGE
 
We are relocating to Florida later on in the year, we will be looking to buy a house and put down a large deposit with the money from the sale of our house in the UK can anyone let me know how easy it is to get a mortgage in the USA when you have just relocated and do you have to build up a credit score from scratch in the USA. Any advice would be most helpful

NatashaB Mar 1st 2011 7:42 pm

Re: USA MORTGAGE
 
We got a mortgage through Bank of America shortly after arriving here last year. They used a company called Landsafe to put together a credit report on us, which included information from our accounts in the UK. We have a FHA mortgage which means we only had to put down 3.5% of the purchase price. Most people will probably recommend that you contact a credit union (after dealing with BoA, so would I! :)) as they tend to be more flexible in who they will lend to. At the point the mortgage was agreed we had very little credit history other than the electricity bill reporting our payments on time. We couldn't get credit cards or car finance at that point.

If you transfer savings from the UK to fund the deposit then make sure you keep a paper trail of every single transfer so you can prove where the deposit came from. Due to the Patriot act they have to verify where you got the funds from, we had to get letters from HIFX and supply a paper trail for all transfers.

Unless you have a UK Amex card (which you can transfer over to the US if you call and ask them, your credit history for that will follow you here) then yes, you're starting from scratch. Most people get a secured card to build up some payment history.

Mummy in the foothills Mar 1st 2011 8:53 pm

Re: USA MORTGAGE
 
Wait and rent for a year, then you'll know for sure what area you want, many look good at first glance and even after a while, but turn out to be crap. This way you'll be able to change and move to another area then buy.

Bob Mar 1st 2011 10:48 pm

Re: USA MORTGAGE
 
There are so many threads on mortgages and credit history, the wiki also explains the process pretty well.

Generally though, you don't want to buy until you've been here a while, for a start you don't know how shite the neighbourhood might really be, or how bad things might get with HOA fee's if everyone else is bailing, nor what the insurance situation might be like if you're able to get it for certain things etc.

Btw, the paper trail, not to do with Patriot Act, but the old money laundering.

MadRad Mar 1st 2011 11:13 pm

Re: USA MORTGAGE
 
I'm looking to buy a house shortly too (actually had offered on one and was under contract but had to pull out because of structural problems). I personally take a slightly different view and would say set yourself up to buy as soon as you can - I have really struggled to settle here living in our apartment, especially since we had a beautiful house back home till recently. I like to make a house my home and cannot do that in a rental. We've been here almost a year and have still never known a neighbour's name. (People move in and out A LOT, we're probably the longest resident.)

The town we live in is nice and actually doesn't have many crummy areas, but we are very selective about what we want which makes it harder. I'd get yourself out to lots of open houses to get a feel for what's out there - houses here are very different to what you're used to in Blighty and it takes time to work out what you like, what you don't like and what you're prepared to change.

We do everything through the credit union, who are really more like an old fashioned building society - they actually get to know you. The tip they gave us was to pay as much as possible on the credit card, including rent, and clear it every month as that helps build the credit score. Almost 12 months in, we now have good credit scores - weirdly, mine is better than hubby's, even though I have no earnings! We got the okay for a mortgage as long as we had a 20% deposit - and the amount borrowed didn't really matter, it was having that 20% that was key.

Now all we need is to find a house!

Sally Redux Mar 1st 2011 11:17 pm

Re: USA MORTGAGE
 

Originally Posted by Bob (Post 9211543)
There are so many threads on mortgages and credit history, the wiki also explains the process pretty well.

Generally though, you don't want to buy until you've been here a while, for a start you don't know how shite the neighbourhood might really be, or how bad things might get with HOA fee's if everyone else is bailing, nor what the insurance situation might be like if you're able to get it for certain things etc.

Btw, the paper trail, not to do with Patriot Act, but the old money laundering.

I would say rent first, it's not just finding out about the shite bits but you might be kicking yourself over a great area you only find out about once you've bought somewhere else.

It seems surprising that someone could put down less than 20%.

Bob Mar 1st 2011 11:56 pm

Re: USA MORTGAGE
 

Originally Posted by MadRad (Post 9211583)
I'm looking to buy a house shortly too (actually had offered on one and was under contract but had to pull out because of structural problems). I personally take a slightly different view and would say set yourself up to buy as soon as you can - I have really struggled to settle here living in our apartment, especially since we had a beautiful house back home till recently. I like to make a house my home and cannot do that in a rental. We've been here almost a year and have still never known a neighbour's name. (People move in and out A LOT, we're probably the longest resident.)

Flogging a house costs a shed load more over here than it does in England though, you'd realistically need to be living in it for a good 5-7 years to make it worth it unless you're willing to make a loss over all. Of course that'll depend exactly on local housing market, but it's a ball park amount of time.

And even if you owned, you might still never know your neighbours either.

Volt61 Mar 2nd 2011 1:12 pm

Re: USA MORTGAGE
 
I would echo the comments of others who advise that you rent for a while (6 months in each area is plenty of time to allow you to know if you want to stay there).

There's tons of "nice-on-the-surface" homes/districts/neighborhoods but living there may not be like you imagine.
Plus there's hidden aspects of living in an area that you can't learn about from brief assessments and documentation.

Florida, in particular, is a place in which you should tread very carefully as its one of the few states that is close to being lawless without being lawless.

There's a good book about buying a home in Florida, written for UK buyers.
http://www.amazon.co.uk/Buying-Home-...9075122&sr=8-1

ian-mstm Mar 2nd 2011 1:30 pm

Re: USA MORTGAGE
 

Originally Posted by Volt61 (Post 9213034)
There's a good book about buying a home in Florida, written for UK buyers.
http://www.amazon.co.uk/Buying-Home-...9075122&sr=8-1

Complete waste of money. The book is already 7 years out of date and doesn't take into consideration the market crash/burn of the last few years.

Ian

SEL_boy Mar 2nd 2011 2:02 pm

Re: USA MORTGAGE
 
I think you'll have trouble getting a mortgage without having had a job for at least a year. Since the crash they have tightened right up on the requirements.

A friend of mine who's been in her house for several years tried to refinance her mortgage now that the rates are so low, and they wouldn't let her because she had switched job in the last few months - regardless of the fact that she has been continuously employed in the same field for ten or more years.

Obviously this is just my opinion, but I think you should sit tight and rent for at least a year before jumping into a mortgage. It's too expensive to chop and change if something goes wrong or your situation changes.

Also: be mindful that the housing market in Florida was one of the worst hit in the crash, so while there might be bargains to be found, it's also a bit shaky down there. Lots of cowboys taking advantage of the dire straits people got themselves into.

MarylandNed Mar 2nd 2011 4:29 pm

Re: USA MORTGAGE
 
Renting for a while would seem to make sense - but that also depends on many factors.

The advantage of renting is that you have a base from which you can explore further. Then you're in a better position once you're ready to buy. It also gives you time to build up a credit history.

It also depends on what interest rates are like and where the housing market is heading at the time you arrive. If interest rates and/or house prices are going up, you might be better off buying sooner rather than later.

I've heard that Florida is a very good buy at the moment because some properties are currently as much as 70% below their peak values and some people think the market has pretty much reached rock bottom. Other people think that housing prices will be stagnant for years to come.

If I knew all the answers, I'd be rich by now!

MsElui Mar 2nd 2011 5:02 pm

Re: USA MORTGAGE
 
we were determined to buy asap when we got here but ended up renting for various reasons. I am so glad we did. We learnt a lot about the different house styles here - and they are different to the uk - and we didnt appreciate on day 1 how we would be living our life here. We were simply trying to reproduce the exact lifestyle we had just left in England. But life here is different and after living it for a while, and seeing what others did/didnt do we could make a MUCH more informed choice about what we wanted and ended up with a home that suits us down to the ground and is in a different area to what we initially looked at. It even helps to experience a few different season in a place because you will end up with strong views on how the place is affected by the heat or snow etc and make choices accordingly. Even for something as simple as a sloping driveway. Having slid down an ice covered steep driveway for the whole of every jan/feb in Ohio - i can tell you a flat driveway is a huge bonus lol, or on the other end - just how much time you will spend outside may affect what type of garden you chose (patio, deck, bbq area, firepit, pool, shade, etc - all choices to make once you know how its going to feel/work for you). Or how much you like or detest the concept of a HOA - and then chosing a home that has the right HOA or no HOA accordingly.

Regarding settling and neighbours. This can depend on the street you end up in and you can also take friends with you. We rented our first US home for just 4 months and made some wonderful friends there. Ive even made friends with people in that neighbourhood that moved there after we left- its just a fab community. I still see those people every month even though i live in a different town. The second place we rented for 8 months was totally different and we didnt make any friends there and never visit. Again - the place we ended up buying is fab and we have lots of friends here. So settling is what you make of it.

TimNiceBut Mar 2nd 2011 5:23 pm

Re: USA MORTGAGE
 
Another vote for renting - there are a bunch of issues with Florida real estate at the moment and the state has one of the highest foreclosure rates in the nation. You might be able to pick up a bargain or something that feels like a bargain but unless you know the local market very well, you might find that it wasn't, or that most of your equity has been eaten up by further price falls in your specific corner of Fla.

shaunos Mar 2nd 2011 8:11 pm

Re: USA MORTGAGE
 
What's HOA? Is this some sort of community association, for street maintenance etc?

EricK Mar 2nd 2011 8:25 pm

Re: USA MORTGAGE
 
I can only agree on the rent for a year comments.

I have been here a year now, I considered trying to buy when I arrived, however I really had no clue about areas, I can say with 100% certainty I would have regretted buying any of the properties I was considering a year ago due to the areas I was looking in.

Its only now, 12 months later, that I have a good idea of which area I would like to buy something in.


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