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US Mortgage Terms

Mortgage - a pledge for which you pay money for housing each month, and paying it back as a whole, you receive it as a property. If you stop paying, the house becomes the property of the bank and can sell it.

And the drip in America will become much easier with the company American Butler, whose specialists will provide support and support absolutely at all stages of a real estate loan. Leave your request and we will contact you shortly for further details.

If in Russia it is easier to get a mortgage, in the USA it is easier to return it. Why? We learn further.

Mortgage USA - photo of the house on the calculator - American ButlerUS Mortgage History

Mortgage in America is an exceptionally reliable financial instrument, which in the modern world, more than ever, allows you to expand the opportunities of potential investors specializing in the real estate market.

Mortgage loans originated under Roosevelt, in the 30s of XX century. The fashion to buy individual housing has jumped, the state has created regulatory bodies - the Federal National Mortgage Association, the Housing Lending Corporation.

By the 60th, half of the shares of the Mortgage Association were put up for sale - anyone could buy them. So the institution became half state, half private - even structurally it was divided into two. So, citizens were responsible for the development, and for the laws regulating the mortgage, the state.

The number of mortgage loans grew - by 1980, 8,500,000 families had used them, and they had spent a total of $12,000,000. After another 10 years, the funds issued by banks exceeded $3.5 trillion. Don't even try to count the number of zeros.

By the middle of zero, the quality of loans fell, because everything was put on stream. We will not begin to load you with frauds with throwing risks at each other and buying bonds - for this there is the film “The game for a slide”. But the result was simple - by 2007, many banks had gone bankrupt, and families had stopped paying their mortgages, as housing prices had fallen. The question is, why pay $300,000 for a house that started to cost  90,000, right?

It was not only America that suffered; in general, all countries that borrowed from such banks suffered. The financial pyramid, built by speculators, has taught the United States a lot - now it’s not easy to get a mortgage, and the responsibility for non-payment is much higher.

Mortgage in America - photo of a married couple signing a mortgage agreement in the USA - American ButlerUS Mortgage Conditions for Americans

Mortgage lending, in the first place, allows you to purchase any real estate - your own house, apartment or townhouse by distributing the payment in a convenient time interval for each client. In the US, mortgage lending is more common than in Russia. Approximately 89% of all home purchases are made on credit, with the initial payment varying between 20-50% of the exact estimated value of the property.

Mortgage in the United States is available for up to 360 months with a fixed interest rate in the first five years, then recalculation takes place depending on the value of the LIBOR rate. For individuals and legal entities, the process of registration of a mortgage agreement takes from 24 to 60 working days.

If in 2008 real estate prices collapsed, now they are rising again from their knees - every year the interest rate on the loan increases by about 0.5-1%. In 2018, the average rate is 5%, and the amount occupied is $100,000.

This approach, in fact, will only make housing more affordable - after all, fewer people will refuse to pay for a mortgage in the middle of the term.

There are two types of interest rates:

  • fixed (the percentage does not change during the entire loan period - and this is 30-40 years);
  • floating (lower by 1-2% , but the risks are higher - so it is more profitable for those who pay the loan in the first 3-5 years, before the start of rate hikes).

Requirements for obtaining a mortgage for US citizens are:

  • from 25 to 75 years;
  • a year of experience, or even better, two, and in one place;
  • down payment (from 0 to 50% of the amount);
  • US citizenship.

Here on this point, we think, many of you have given up. But nothing - and for foreigners have the opportunity to take a mortgage. That's just about the fabulous 5% of the rate will have to forget.

Mortgage in the USA - photo of an approved mortgage agreement in Miami with house keys - American ButlerConditions for all others

Mortgages in the United States are available to foreigners at two options of interest rates: fixed and floating. To get this type of loan, you must translate all documents into English, take out insurance and go through a series of inspections of the mortgage lending facility. The interest rate on loans depends on many factors, ranging from the history of payments, ending with the limit on credit cards and can vary from 5% to 8%.

You can get a house loan if:

  • you constantly live in the USA;
  • got a green card;
  • working on a visa;
  • do not live in the United States.

It is not necessary to have all four points, one is enough. The first two categories have almost the same rights as ordinary citizens: they have a reduced rate, benefits, no additional fees, and the loan itself is easier to get.

The rest is worse - you have too many risks for the bank. You will have to immediately pay 25-50% of the cost, 3-5% of the non-refundable commission from the bank, and then pay another 10% as a rate. Yes, and the loan amount will be reduced to $2-3 million. This will be enough for you, but especially you will not flit. Such conditions are even worse than in Russia itself. And you know what?

You may still not approve. To get a mortgage loan in the USA, the client will need to have an open account with a US bank and deposit on it a sum of money sufficient to cover the initial payment, all insurance and fees, as well as monthly payments during the first year of payment on the loan.

The main gag - you need to prove financial viability. And go and prove it without an account in an American bank. And you will definitely not open it remotely - after September 11, 2001, this opportunity was covered.

So do this:

  • open an account in a US bank;
  • apply for a loan there too;
  • checks your credit history;
  • collect and submit all documents;

PROFIT - sign all the papers and you can almost immediately move in.

Well, or they will again refuse you, but then the matter is in credit history or documents.

Mortgage in America - photo of a family with a child playing catch-up on a front lawn in Miami - American ButlerWhat documents are needed for a mortgage

The requirements vary from state to state, but usually the bank needs:

  • passport;
  • American visa;
  • documents for housing;
  • a letter of recommendation from any Russian bank that you are clever and are paying everything (they may not give it);
  • confirmation that you have a job;
  • proof of residence (enough for payment receipts);
  • statement on the US account that you have enough money to pay the down payment, commission and reserve for a year.

All documents are in English only. If necessary, hire a translator. The application is considered a month. For checking the submitted documents will take up to $400.

If you have a working visa, it is better to immediately apply for a loan from the Federal Housing Administration. In this case, the credit history is not necessary to show.

What should be remembered?

Future borrowers need to remember that complexity lurks everywhere. So it is better to prepare for some of them.

  • Save money on the assessment (up to $500) and home insurance (1-2% of the cost ). This is important - all of a sudden you will get a house that squeaks and cracks, and you will immediately find all the defects.
  • The more documents you submit, the lower the monthly fee.
  • Keep in mind that on average you have to pay $700-1000. Plus a communal $100-200. Will your salary allow?
  • If you do not allow, then there is refinancing. This is a loan with a reduced rate, which cover the old loan. But better without the need to not use it.
  • The bank takes into account not only your salary, but also passive income: from renting an apartment from you to pension savings.

If the mortgage is new for you, then for the correct execution of all documents, it is better to trust the specialists of American Butler. The company's clients receive the best sample of the existing real estate market and the interest rates of banks. All work is carried out in the legal norms of American legislation, and specialists who speak Russian will help to understand all points of the credit agreements.

Do not want to bother with the documents? Then the American Butler company will help you get a mortgage in the USA correctly. We will find a bank with favorable interest rates and understand the intricacies of the loan agreement.
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