A Non-QM Solution for ITIN Borrowers: Self-Employed ITIN Card Holders Can Qualify for an ITIN Loan

Dec 5, 2023

In today’s diverse and globalized world, many individuals living and working in the United States may not possess United States Citizenship. However, this should not hinder their dreams of homeownership. In this blog post, we will explore a non-QM (non-qualified mortgage) solution that enables ITIN (Individual Taxpayer Identification Number) borrowers to purchase a primary home.

Scenario Overview:

Our borrower is a hardworking individual who has been living and working in the United States. Although they do not possess United States Citizenship, they have a valid ITIN card, a government-issued photo ID, and a utility bill, which establishes their residency status. This borrower has been diligently saving and has a substantial 25% down payment ready to invest in their dream home.

Challenges Faced:

The borrower’s journey towards homeownership faced a significant hurdle due to their non-citizen status. Traditional mortgage lenders often require United States Citizenship or a Social Security Number, making it difficult for ITIN borrowers to access mortgage financing. Additionally, the borrower’s debt-to-income ratio, as reflected in their tax returns, was 69%, which further complicated their loan approval process.

The Non-QM Solution:

Fortunately, our ITIN loan product was designed specifically to address the unique needs of ITIN borrowers. By leveraging their ITIN documentation, we were able to verify their residency status and obtain a U.S. credit report to conduct a comprehensive credit analysis. This allowed us to assess the borrower’s creditworthiness based on their FICO score of 742, which was obtained using their ITIN number.

To overcome the challenge of the borrower’s high debt-to-income ratio, we took a holistic approach to income verification. Instead of relying solely on tax returns, which may not accurately reflect the borrower’s current financial situation, we utilized 12 months of their business bank statements. This provided us with a more accurate representation of their income, resulting in a debt-to-income ratio of 43%.

Benefits of the Non-QM Solution:

Our ITIN loan product offers several benefits to ITIN borrowers seeking homeownership. Firstly, it provides an inclusive pathway to mortgage financing, irrespective of United States Citizenship or Social Security Number. This opens up opportunities for a diverse range of individuals to achieve their homeownership goals.

Secondly, by considering alternative income verification methods, such as business bank statements, we ensure that borrowers with non-traditional income sources are not unfairly excluded from the mortgage market. This approach recognizes the entrepreneurial spirit of ITIN borrowers who have started their own businesses and may not have a conventional employment history.

Contact us today to learn more about how we can help you achieve your dream of homeownership, regardless of your citizenship status.