Have you ever thought about purchasing a vacation home for your winter getaways from Canada to Florida? Then, perhaps, you have tried only to find the requirements and qualifications to do so were too much of a hassle and just not worth it? Get ready for some good news: Recent policy changes will actually allow you to qualify as though you are a U.S. citizen, without jumping through all those previous hoops!
For quite a while, buying a second home in the United States has been difficult for Canadian citizens. Currently a handful of lenders, including Sunbelt Lending Services, are granting conventional mortgages in the States with requirements similar to those for a U.S. citizen. The qualifications and requirements vary from lender to lender, but generally are as follows:
- Must be a second home.
- Loans can be up to 70% loan-to-value.
- Canadian credit report required. If a credit score is available, it must be no less than 680.
- Verification of mortgage on primary residence in Canada.
- Last two pay stubs and two years of T4 slips.
- Two months of bank statements.
- Funds for down payment, closing costs and 12 months of reserves must be in a U.S. financial institution and seasoned for 60 days.
- Canadian driver's license and copy of passport.
- Cannot be a citizen of any other country, a permanent resident alien of the U.S., or a non-permanent resident alien residing in the U.S.
- Escrows cannot be waived, and gifts are not permitted.
- If you are self-employed, you may be required to present the last two years of your Canadian tax returns, along with a profit/loss statement and balance sheet.
- An ACH Form and a W-8 must be signed prior to closing.
Because of the property's second home status, some lenders introduce special clauses not included in the guidelines above, such as prohibiting the home's use as a rental property. Again, it depends on the lender, but in general they all follow the same basic guidelines.
Don't delay and get left out in the cold! Take advantage of the buyers' market advantage now; and remember, these new loan programs could change at any time ... so act fast!
If you'd like more information about rental and vacation properties, get in touch with Julian directly via the Sarasota Property Finders Contact Page.
Sarasota Area Real Estate Specialist