Legal Question in Real Estate Law in California

Foreign buyer
Hi, I am a foreigner and I would like to finance a home in Los angeles. I have Social Security and my mother would be the one who finance the loan. How much down payment would I have to put? I heard that usually American put 10-20 percent down payment. Would my status as a foreigner affect the down payment?

Asked on 6/04/08, 8:01 pm

2 Answers from Attorneys

Bryan Whipple Bryan R. R. Whipple, Attorney at Law

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Re: Foreign buyer

There is no legal minimum down payment for purely private financing. If your mother will be the lender, she can lend 100% of the purchase price if she is willing to do so. You are correct that 10 to 20% is more customary for a down payment, or to put it another way, most lenders prefer to stop at lending 80% to 90% of the purchase price because it gives them some protection against being under-secured in case the borrower defaults and they have to foreclose.

It's possible that some Federally-backed lending and mortgage programs may have stricter rules for loans to "foreigners," but if so, I don't know those rules.

Please keep in mind that the term "foreigner" doesn't have a clear legal meaning here. Our laws and rules are more oriented to concepts such as "legal immigrant" "undocumented alien" "nonresident alien" and so forth, reflecting visa or immigation status. As a general rule, U.S. laws give foreigners the same rights to buy and own property that citizens have.

Both private and Federally-subsidized home lenders would be more interested in the quality of the loan than the citizenship of the borrower.

Answered on 6/04/08, 10:29 pm

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