Foreign National Mortgages Texas: A Guide to Real Estate Investing

Empower Your Real Estate Ventures and real estate investment in Texas with Waltz

Maximize the potential of Texas real estate investing with Waltz. Whether you seek to lower interest rates, shorten loan terms, or access equity for further investments, we are a foreign national mortgages Texas provider that offers customized solutions to address your unique needs.

We are providing the following discussion to you for informational purposes only. All investments, including real estate, involve risk, and we encourage you to invest carefully. The information in this article is not intended to replace or serve as a substitute for any legal, real estate, tax, or other professional advice or service. You should consult with a professional in the respective legal, tax, accounting, real estate, or other professional area before making any decisions or entering into any contracts relating to a rental property.

What are Foreign National Mortgages?

If you’re a non-resident hoping to secure financing for a U.S. property, you’ll run into a few unique challenges. Foreign national mortgages are specifically designed to bridge this gap. Tailored to the financial profiles and circumstances of international investors, these mortgages offer a pathway to owning Texas real estate and engaging in real estate investing in Texas.

At Waltz, we understand the intricacies of foreign national mortgages and can demystify the complex landscape of U.S. real estate financing for our international clients. Use our mortgage solutions to pave the way to financial success in the state of Texas.

Benefits of Investing in Texas Real Estate for Foreign Nationals

Texas is a hot market for foreign real estate investors. The Lone Star State has a strong economy, a thriving job market, and low taxes, making it a perfect place to build wealth with investment real estate.

A few more reasons why real estate investing is bigger and better in Texas:

A robust rental market that ensures consistent cash flow for investors
Steady property value appreciation
Diverse investment options, from single-family homes to commercial properties
No state income tax
A long-standing reputation for being business-friendly with a stable political climate

All of these benefits make Texas an attractive option for foreign nationals who want to get the most bang for the buck in the real estate investment market.

Specific Considerations & Requirements for Mortgages in Texas

There’s a lot to love about investing in Texas real estate, but there are a few key pitfalls to be aware of, too. Property taxes, insurance costs, and other factors can affect how much return you’ll earn from your investment.

The following are five things to consider before moving forward with a Texas mortgage:

High property taxes: Texas property owners pay substantial property tax payments each year.
Natural disaster risk: Certain Texas markets are more susceptible to natural disasters. If you buy in an affected area, you’ll need to pay for additional insurance coverage.
Homeowners Association (HOA) fees: Many desirable Texan neighborhoods have HOA fees and regulations.
‍Market fluctuations: Like other desirable markets, Texas is susceptible to economic and real estate market trends. Keeping up with these fluctuations will help you make an informed purchase decision.

Which Cities in Texas are Best for Foreign National Investing?

Texas is home to several thriving cities that offer excellent investment opportunities for foreign nationals. The best places to invest in real estate in Texas include:

Austin: Known for its tech industry and vibrant culture, Austin has experienced rapid growth and strong property appreciation.
Dallas-Fort Worth: As a major economic hub, the Dallas-Fort Worth area offers a diverse real estate market with opportunities in both residential and commercial sectors.
Houston: The energy capital of the world, Houston boasts a strong economy and a steady stream of renters.‍
San Antonio: With a growing population and affordable housing options, San Antonio presents attractive investment prospects.

Types of Mortgages Available for Foreign Nationals in Texas

Foreign nationals can access a variety of mortgage products, each with its own benefits:

DSCR Loan: Debt service coverage ratio (DSCR) loans make it easier for foreign investors to buy US rental properties. Unlike traditional mortgages that heavily rely on a borrower's personal income and credit, DSCR loans focus on the property's ability to generate income. By focusing on the property's income-generating potential rather than the investor's personal finances, DSCR loans eliminate the traditional hurdles often faced by international buyers. Waltz specializes in DSCR loans for foreign investors. Contact us to get started.
Non-Resident Conventional Loan: These loans offer competitive rates but typically require a higher down payment (often 30% or more) and may not require a U.S. credit history.
ITIN Loan (for certain non-residents): This program allows qualified borrowers to use an Individual Taxpayer Identification Number (ITIN) instead of a Social Security number. It often has down payment requirements around 30% and may have specific requirements for employment and income verification.
Jumbo Loan (for high-value properties): Jumbo loans are for mortgages that exceed $766,000, and sometimes over $1 million. These programs are more exclusive and cater to foreign investors with substantial assets and strong financial profiles.‍
Hard Money Loan: This is a short-term option from private lenders. It can be useful for quick closings but comes with higher interest rates and stricter terms.

Process of Refinancing for Foreigner Nationals in Texas

Refinancing your Texas investment real estate can help unlock equity, lower your monthly payments, or access funds for other investments. The refinancing process for foreign nationals generally involves:

Determining your property's current market value
Exploring different loan terms and interest rates to find the best deal
Preparing financial documents, including income verification and property ownership proof
Completing the application process
Once approved, finalizing the refinancing transaction

At Waltz, we recognize the significance of this process for real estate investors in Texas and offer seamless solutions to optimize your investment strategies.

Exploring Refinancing Options for Foreign National Mortgages in Texas

Rate-and-term refinance

This option can be quite interesting for foreigners looking to invest in the Texas market because it allows you to adjust the terms of your current mortgage— with the potential that it can result in a better deal on your house loan. Please note that even if you refinance an existing loan at a lower interest rate, your total finance charges may be higher over the life of your loan.

Cash-out refinance

At Waltz, we proudly offer this option to Texas foreign investors as it allows you to access your property's equity— allowing you to borrow more than the current mortgage balance (based on the original equity).

For those interested in Texas real estate investments, the additional funds can be utilized for various personal objectives, such as home upgrades, debt consolidation, or a down payment on another property. This provides you with cash at closing for a range of needs, broadening your investment opportunities while leveraging the best foreign national mortgages Texas has to offer.

Tax Considerations for Foreign Nationals with Texas Real Estate Investments

Texas handles taxes a little differently than other U.S. states. So, it’s important to understand the tax implications of owning Texas real estate investments to make the most of your investment. Key tax considerations include:

Property taxes: Texas imposes property taxes on real estate ownership.
Income tax: While Texas has no state income tax, federal income tax applies to rental income.‍
Foreign Investment in Real Property Tax Act (FIRPTA): If you sell your Texas property, you may be subject to FIRPTA withholding.

Waltz Will Help You Invest in Texas Real Estate

Waltz is committed to assisting foreign nationals in achieving their Texas real estate investment goals. Our expertise in foreign national mortgages, combined with our in-depth knowledge of the Texas market, enables us to provide tailored solutions. We offer comprehensive support throughout the entire investment process, including:

Our Investor Kit simplifies the process in just a few clicks.

LLC Formation Tailored for You: We'll establish a Limited Liability Company (LLC) that meets your specific investment needs. This protects your personal assets while keeping you compliant with Texas laws.
EIN Secured: If you want to open a bank account and manage your property finances, you need an Employer Identification Number (EIN). We’ll provide one for you.²
Operating Agreement Made Easy: Got 20 minutes? That’s all the time we need to handle the operating agreement, outlining ownership structure and management within your LLC.

Best of all, after you purchase your Investor Kit, Waltz provides loans up to 70% LTV.³ You’ll also be able to open a U.S.-based bank account through Waltz to handle your property’s financing.