Are you a DACA recipient dreaming of buying the perfect house since you entered the country with your parents? By now, you have understood one thing – the road is likely to get rough. Yes, financial obstacles have been a part of your life, but the home-buying process can get easy when specific tips are followed. FHA loans might be off your list due to HUD’s statement, but it should not crush your dreams into pieces. With mandatory documents and adequate credit scores, home financing may seem like a cakewalk.
The Deferred Action for Childhood Arrivals is an immigration law that permits people brought into the United States as children. Once the underage children turn adults, they get a work permit. Of course, the Dream Act is under much controversy due to the socio-political scenario. Nevertheless, private lenders still allow for DACA mortgage loans in Houston and provide the necessary assistance. Usually, Dreamers are denied mortgage programs when they are not following the effective measures. But now is not the time to give up on your homeownership! So, let’s go through the following tips to make the process of DACA mortgage application simple.
DACA Recipients cannot Apply for FHA Loans
Dreamers are not eligible for the FHA loans since HUD sent out a letter in 2019. The Department of Housing and Urban Development does not confer a lawful status and the recipients are ineligible for the FHA loan programs. The Federal Housing Administration goes by the HUD’s rules. If you apply for an FHA mortgage program with a credit union or lender, your application might face rejection. The private lender carries out the responsibility of ensuring whether the applicant meets the FHA standards. As mentioned earlier, the FHA is an integral part of the HUD; hence, your application does not see the sunlight.
It is important to know that the US Congress is responsible for determining the immigration and citizenship status; hence, the HUD does not authorize the instruction directly. However, Congress is associated with the Homeownership for Dreamers Act. Therefore, your FHA loan does not get the nod unless Congress clarifies the citizenship status. When drawing a comparison between FHA and conventional loans, the former has low credit score requirements and offers a 3.5% down payment.
Dreamers are Eligible for Conventional Loans
In 2019, the policymakers assured that DACA traditional loans are available for the recipients. They can get hold of the home loan to purchase or refinance a single-family or multi-unit residency. Make sure you have a steady income and 620 or higher FICO scores. In addition to it, a 3% down payment for a single-family residence is another criterion to ace the mortgage application. The private lender might also ask you to share a proof of EAD, income document, and social security number.
So, keep shopping around and find the perfect DACA lender. In this way, you can save a significant amount of interest rates. Ask upfront, know your options, and avoid unpleasant surprises in the future. Many will reject your application but keep trying!