Not So Fast - That ITIN May Still Not be Enough to Get You That Loan
2022-06-27 12:52:31
Not
So Fast - That ITIN May Still Not be Enough to Get You That Loan
If youre a legal resident or nonresident
foreign national working in the United States and hoping to set down some roots
and perhaps buy your home, it would seem that there would be few obstacles in
your way. After all, even if you were not eligible for a Social Security Number
when you arrived in the country, you were certainly issued an Individual Taxpayer Identification Number
in its stead. That ITIN was necessary for you to be able to work, drive, and
enjoy many of the other benefits associated with living in the U.S. In theory
at least, it should also be enough to enable you to get a mortgage for that
home you want to buy.
Not so fast! The fact is that your ITIN may not be as useful for
securing a loan as you had previously been led to believe. In fact, it may
actually put you at a disadvantage with certain lenders. Despite your legal
status in the country, lenders may be more cautious about your loan simply due
to the way in which ITINs are issued to illegal immigrants.
Heres the problem: though the ITIN was
initially designed as a way for the IRS to deal with the taxable income of
those who were not able to obtain Social Security Numbers, the program has
since grown far beyond its initial mandate. It now is managed in a way that
makes little distinction between legal and illegal immigrants and aliens, and
that has resulted in heightened caution in the financial industry.
Heres the problem you might be facing:
because the IRS doles out ITINs to virtually anyone who can produce the
required documents or forged facsimiles even there are an unknown number of
illegal aliens who possess these numbers. Even though the operating premise
with regards to home mortgages and the ITIN has long been that the ITIN is just as valid as a Social Security
Number when it comes to obtaining loans, that is not always turning out to
be the case.
The fact is that illegal immigrants pose a
special problem when it comes to income verification, credit history, and
verifiable documentation. In some instances, these individuals rely on
falsified documentation to obtain loans and other benefits. That fraudulent
activity has now become associated with the ITIN in some lenders minds. And
since they feel that they cannot always trust the documents that ITIN-holders
are providing them, they are understandably reluctant to proceed with some
loans.
Now, none of this should dissuade you from
pursuing a mortgage or other loan. Indeed, if you are here legally and have
access to verifiable documentation and the appropriate level of credit history,
then you should be able to secure the financing you need at the same terms
enjoyed by other residents. At the same time, however, you should be aware that
there may be a little more added scrutiny than you might have expected.
Irving Weissholtz