As the U.S. economy has continued to bounce back, the strengthening dollar and rising U.S. home prices have made it more difficult for foreign buyers to invest in U.S. properties according to Anya Martin for the Wall Street Journal.
In fact, many overseas buyers think it will be to difficult for them to get a loan, so almost 50% of them pay for U.S. real estate in cash. Non-resident foreign nationals aren't eligible for standard government, and many banks see the idea of chasing a delinquent buyer overseas as too risky. But there may be a way for them to get loans a different way. Martin writes:
Some banks offer nonconforming loans to affluent foreign borrowers and then sell them to an emerging market of nontraditional lenders. “The applicant goes through the standard qualifying process using alternative forms of verification for credit, income and assets,” says Total Mortgage CEO John Walsh. Total Mortgage now can lend from $200,000 up to $2 million to well-qualified, nonresident foreigners. However, these loans require a larger down payment than most mortgages—30% and up on loans up to $1 million and more for larger loans for a second-home purchase, Mr. Walsh says. Rates range from 5% on a five-year, adjustable-rate mortgage to 6.625% on a 30-year, fixed-rate mortgage.