ITIN Mortgages: How Home Loans Work for Borrowers With an ITIN

An ITIN mortgage is a home loan for borrowers with an ITIN instead of a Social Security number. These loans are usually offered through non-QM or portfolio programs rather than standard agency programs, and they rest on the same basics as other mortgages: verified income, credit history, funds for the down payment and closing, and an eligible property. Documentation is adapted for borrowers who may have shorter or non-traditional credit files, and programs vary by borrower, property and investor.

What an ITIN is

The IRS issues an Individual Taxpayer Identification Number, a nine-digit number, for federal tax purposes. It goes to people who need a U.S. taxpayer identification number but do not have, and are not eligible for, a Social Security number. You apply for one with IRS Form W-7, which is also used to renew an ITIN that is expiring or has expired.

The IRS describes the ITIN as a number for the federal tax system, not a form of identification outside it. On a mortgage file, lenders use it as your taxpayer identification number and look to your other documents to confirm who you are. This site does not give legal, immigration or tax advice. For immigration questions, consult an immigration attorney. For questions about your ITIN, your filings or how owning a home affects your taxes, talk to a tax professional.

How ITIN mortgages work

An ITIN loan follows the same general path as any other mortgage, with some differences in what lenders accept:

• Income. Lenders commonly ask for tax returns filed with your ITIN, along with W-2s, 1099s or pay stubs. Self-employed borrowers may be able to use bank statement programs.
• Credit. A U.S. credit report is used if you have one. If your file is thin, some programs accept alternative credit references.
• Funds to close. Your down payment and closing money are verified, usually through a U.S. bank account. Many programs expect a larger down payment than agency loans.
• Property and use. Primary residences are the most common use. Some programs also allow second homes or investment property.
• Ability to repay. Non-QM loans are not held to the Qualified Mortgage rules, but lenders must still make a reasonable, good-faith determination of your ability to repay.

Credit history options

Some borrowers with an ITIN have a full U.S. credit report with a long history. Others have a short file or none at all. Programs handle this differently, and some accept a mix of the following:

• Traditional credit. Credit cards, auto loans or other accounts that report to the credit bureaus.
• Rental history. Canceled checks, bank records or a landlord's letter showing on-time rent.
• Utility and phone bills. A record of regular, on-time payments in your name.
• Insurance payments. Auto, renters or other insurance paid on time.
• Letters from creditors. Statements from lenders or businesses you have paid over time.

If you plan to buy later rather than sooner, building a record of on-time payments in your own name now can widen your options. Ask a loan officer which references a program accepts before you gather them.

Documents lenders commonly ask for

• Your ITIN letter from the IRS.
• A passport or other government-issued photo ID.
• A visa, if applicable.
• Federal tax returns filed with your ITIN.
• W-2s, 1099s and recent pay stubs, or bank statements if you are self-employed.
• Statements from a U.S. bank account showing your down payment and closing funds.
• Foreign bank statements, if any of your funds are held outside the U.S., often with translations.
• Credit references, such as rent, utility or insurance payment records.
• Explanations and paper trails for large deposits.

The list varies by program. Ask for the full list in writing at the start so you are not chasing documents near closing.

What to expect on pricing and terms

ITIN loans are non-QM loans, and non-QM loans often price higher than agency loans because they carry more risk for the investor. You may see a larger down payment requirement, a range of term options, and features such as an adjustable rate or a prepayment penalty. None of these are good or bad on their own, but each one changes your cost and flexibility.

The Loan Estimate is your tool for comparing. It shows the loan terms, projected payments, closing costs, cash to close and features like prepayment penalties and balloon payments. It also lists the loan officer's name and licensing information. Ask for Loan Estimates from more than one lender for the same type of loan.

From application to closing

The steps look much like any other home purchase:

1. Talk to a loan officer. Share your income type, credit situation and the funds you have for the purchase so they can match you with programs that accept borrowers with an ITIN.
2. Gather documents. Use the program's checklist, and get translations ready for any documents not in English.
3. Apply and review the Loan Estimate. Compare it with estimates from other lenders.
4. Appraisal and underwriting. The lender orders an appraisal, verifies your documents and may ask follow-up questions.
5. Review the Closing Disclosure. You receive it at least three business days before closing. Compare it with your Loan Estimate.
6. Close. Bring the identification the closing agent asks for, and confirm wiring instructions by phone before sending any money.

If you were turned down elsewhere, ask why. Sometimes a different program, a co-borrower or more time building credit changes the answer.

Questions to ask a loan officer

• Which documents does this program require, and in what form?
• Will you use my U.S. credit report, alternative credit references or both?
• Is the rate fixed or adjustable, and how could it change?
• Is there a prepayment penalty? If so, when does it apply?
• Can a co-borrower with a different type of taxpayer number be on the loan?

Other options to consider

An ITIN loan is not the only path for every household. If someone in your household has a Social Security number and qualifying income, the loan officer may look at whether other programs fit, depending on who will be on the loan and on title. Some borrowers with strong savings may also be able to make a larger down payment, which can widen their choices. A licensed loan officer can lay out the options side by side so you can weigh the cost and requirements of each. Programs vary by borrower, property and investor.

Red flags to watch for

Be wary of anyone who promises a loan regardless of your credit or income, pressures you to sign quickly, or suggests using another person's identification number. Before you share documents, confirm the company and loan officer are licensed using NMLS Consumer Access, a free online tool, and contact your state regulator if you have concerns about a lender's conduct.

Frequently asked questions

Next steps

• ITIN Mortgage Loans
• Non-QM Loans
• ITIN Mortgage Loans in Florida
• ITIN Mortgage Loans in New York
• ITIN Mortgage Loans in New Jersey
• ITIN Mortgage Loans in Pennsylvania
• ITIN Mortgage Loans in Connecticut
• ITIN Mortgage Loans in Virginia

Sources

• IRS: Individual Taxpayer Identification Number (ITIN)
• IRS: About Form W-7, Application for IRS Individual Taxpayer Identification Number
• CFPB: What is the ability-to-repay rule?
• CFPB: Loan Estimate explainer
• CFPB: How to check if a company or person is permitted to make or broker mortgage loans