Many people still think that you can't buy a house with just an ITIN. To put it simply, you can. However, the path is narrow and the costs are higher.

In consultations, I often see cases like this. Individuals who have been diligently filing taxes for over ten years and have stable business revenue are turned away at the bank simply because they don't have an SSN. A rejection from one bank is not the end.

First, you need to understand the structure. ITIN loans are classified as Non-QM products that do not meet the standards of Fannie Mae or Freddie Mac. Therefore, the lending institutions either hold these loans directly or pass them on to private investors.

The government route has become even narrower. HUD has removed non-permanent residents from FHA loan eligibility with mortgage letter 2025-09, and this change took effect on May 25, 2025.

Currently, those who can use FHA loans are citizens, permanent residents, and citizens of Micronesia, the Marshall Islands, and Palau. The option to enter with a 3.5% down payment is effectively unavailable for ITIN holders.

So, who will lend? Primarily, Non-QM specialized lenders, local banks operating with their own portfolios, some credit unions, and brokers who connect these products wholesale. Most large national banks do not have separate ITIN programs.

Let's look at the conditions one by one. The most basic requirement is the last two years of tax returns filed with an ITIN. This is a common requirement across almost all lenders.

One thing that is easy to overlook is the validity period of the ITIN. According to IRS standards, an ITIN that has not been used for tax reporting for three consecutive years expires. You need to check if your number is still valid before applying.

The down payment is the area where it differs most from a regular mortgage. Industry guidance generally indicates a range between 10% and 25%, with many places setting a baseline of 20%.

The range varies depending on the credit score. If you have a U.S. credit score, many lenders consider a baseline of 620 to 660 or higher. If you have no score at all, they will assess alternative credit such as utility or rent payment records, but they tend to require a higher down payment.

Debt-to-income ratio is also considered. Many lenders have a guideline that your monthly debt payments should be 43% or less of your income, with some preferring 40% or lower.

Now, let's talk about interest rates. First, let's establish a comparison benchmark. According to Freddie Mac's weekly survey, as of September 24, the average for a 30-year fixed mortgage was 7.03%, and for a 15-year fixed, it was 6.42%.

It has steadily risen from 6.71% at the beginning of September over the course of a month. Compared to the same week a year ago at 6.30%, it is 0.73 percentage points higher. Honestly, this trend is not welcome for those entering the market this fall.

ITIN loan interest rates come with an additional markup. According to guidance released by lenders, they are generally set 1 to 3 percentage points higher than regular mortgages. However, the rates can vary significantly based on down payment, credit, and income verification methods.

When you compare two individuals side by side, it becomes clear. Permanent resident A can qualify for a conventional loan with a down payment starting at 5% and receive a rate close to the average. ITIN holder B, even for the same house, will need to prepare a much larger down payment and start with a rate several steps higher.

Therefore, B needs to calculate differently. It's not just about the monthly payment; it's also about how much cash can be tied up initially.

If you're in New Jersey, there's one more factor: property taxes. New Jersey's property taxes are among the highest in the nation, so the monthly burden, including principal, interest, taxes, and insurance, can be significantly higher than expected.

In neighborhoods like Bergen County, which are popular among Koreans for their school districts, both home prices and taxes can be substantial. There are cases where individuals are disqualified due to taxes affecting their debt-to-income ratio. It's advisable to check property tax records when viewing listings.

The required documents are roughly as follows. ITIN issuance documents and identification such as a passport, along with two years of tax returns, are essential.

Bank statements are also necessary. If you are self-employed, you should prepare business-related documents and profit and loss statements as well.

The source of down payment funds is scrutinized closely. Sudden large sums of money will require explanation. If the money was transferred from Korea, it's best to organize the transfer records and source in advance.

There are tips for choosing a lender as well. Don't just look at one; get conditions from at least three or four places. You should not only compare interest rates but also consider points, fees, and whether there are early repayment penalties.

Early repayment penalties are particularly important. Some Non-QM products may impose penalties if you pay off or refinance within a few years. If you plan to refinance later when your status changes, this clause could be a hindrance.

Let's also touch on refinancing. If you obtain a green card or SSN, the path to switch to a conventional loan opens up. In this case, the current high interest rate can be viewed as a temporary cost rather than a permanent one.

Be cautious of scams as well. There are advertisements targeting ITIN holders that promise guaranteed approval with no documentation required. Be sure to check the license numbers of lenders and agents on the NMLS site.

Many people ask whether renting or buying is better. With interest rates around 7% plus additional markups, the immediate monthly burden is likely to be higher than renting. However, if you plan to live in the same area for several years and have cash ready, it is worth considering.

In my judgment, if you can comfortably put down more than 20% and have a clean tax reporting record, it is worth exploring the current conditions. If that's not possible, I would choose to build up income records and credit over the next 1-2 years before preparing.

Conditions vary by lender and personal circumstances and change frequently. Before applying, please confirm your documents with a licensed loan officer and tax professional.