Most people who want to buy homes cannot pay cash. They need a mortgage to fund the transaction, and they may spend three decades paying off the funds they borrowed to purchase their homes. Qualifying for a mortgage from a profit-driven lender can be a challenge. Banks and mortgage companies generally only want to extend loans to people who are unlikely to default and cost the company money. Individuals with lower incomes and compromised credit histories often look into Federal Housing Administration (FHA) loans as an alternative to standard mortgages.
Individuals with low credit scores can qualify for FHA loans when they might not be eligible for other mortgages. Historically, people with as little as 10% down have been able to qualify for FHA mortgages. Immigrants working and studying in the United States are among those who might seek to acquire real property using an FHA mortgage. Many people who might have previously qualified for FHA mortgages are no longer eligible.
What policies have changed?
Historically, many people living and working in the United States might be eligible for an FHA mortgage even when they may not remain in the country permanently. However, changes in federal policy, including immigration standards, have trickled down to affect aspiring homeowners.
Under a recent adjustment in FHA lending policies, these loans are now only available to lawful permanent residents and United States citizens. Immigrants who have visas or who may have qualified for asylum or refugee status may not be able to acquire real property using an FHA loan under the new rules.
Immigrants may face difficulty accessing financing for home purchases because of this sudden change in policy. Those in the middle of the home-buying process and about to start looking into mortgages may need assistance evaluating their options under this new policy.
Aspiring home buyers may need help evaluating their options and navigating what can be a very complicated transaction. Currently, federal regulations do not prohibit immigrants, including those who only have temporary lawful status in the United States, from acquiring real property. They may simply need more creative solutions for financing these transactions.
Reviewing personal circumstances and home-buying goals with a skilled legal team can help people determine whether the change in FHA mortgage policies might affect their dreams of homeownership. People preparing for real estate transactions often need help protecting themselves and navigating the paperwork required to buy a home, and that’s okay.