How to buy an investment property in the U.S.: from A to Z

We know — you are probably feeling hopeless about buying a U.S. investment property as an international buyer. After a fair amount of research, all of the information that you’ve read has probably told you that you will need to pay upfront for the purchase in cash.

However, that isn’t the case anymore. Milo has the solution

Now, you will be able to acquire your investment property with financing. Are you excited yet? Get ready to learn how to buy an investment property in the US with a mortgage loan:

3 Best Practices to Get You Started

#1. Always ensure that you have achieved financial stability and a robust savings before you consider buying a home.

#2. Make sure you set up a U.S. bank account with savings stored away. We will come back to this later.

#3. Start thinking about the upfront costs that you will need liquidity for: down payment, closing costs, and the property appraisal.

10 Steps to Buying a Property as a Non-US Citizen

#1. Define what the property will be used for.

#2. Identify the market where you’d like to acquire the property.

#3. Decide the legal form you are going to use to buy this property.

#4. Conduct online research.

#5. Get a Pre-Approval letter with Milo.

#6. Decide whether you’d like to work with a real estate agent.

#7. Tour homes. Decide. Make an offer!

#8. Get a home inspection.

#9. Start your mortgage application with Milo.

#10. Close on your purchase and enjoy your new property!

Step One: Define the property’s intended use

Is it an investment property, primary residence, or second home?

First things first, you need to know how you are going to use the new property you’re dreaming about. The property’s intended use will guide the buying process. Selecting a primary residence is different from buying an investment property.

For example, if your property is destined to be an investment, you should research up-and-coming, high-traffic neighborhoods. This will increase your chances of renting it quickly and at a better rate.

Making this decision will also narrow down your search to the specific property type, whether a condo, single-family home, or townhouse.

Step Two: Identify the market you’d like to target

When you know what type of property you want, it’s time to decide on its location.

The type of property and its intended use will determine the best market to purchase a home in.

For example, a second home should be somewhere you’ll want to vacation in. A primary residence needs to be in a convenient location nearby your lifestyle necessities and preferences.

On the other hand, investment properties make the most when in a location that best appreciates the asset’s value. Investments should be a financial decision, not a personal one.

Step Three: Decide the legal form you are using to buy this property

Your options are LLC, Individual, or US or Foreign Corporate Ownership.

This is important, so spend time researching your alternatives. Each entitlement has its benefits. A lawyer is best suited to guide you through the options. You can find additional resources on the matter here.

Step Four: Start your research online

Keep in mind that lenders recommend that your property does not cost more than three to five times your annual household income.

Take a look at online listings for available properties for sale in your targeted area. Browse through reputable listing portals, like Zillow or Realtor.com, from the comfort of your own home.

Step Five: Get a pre-approval letter with Milo

Once you have a few good properties in mind, Milo is your best source to get pre-approved for your mortgage.

We’re a digital bank solution uniquely created for international clients like you. If you don’t have a Social Security Number or a US Credit Score with enough history to qualify for a loan, don’t worry — we can help you. Learn more about us here.

Essentially, what you need at this point in the process is a pre-approval letter. You can get one with Milo in minutes.

The pre-approval letter outlines an estimate of how much you can afford in financing. It helps you in negotiating price as well as show how serious you are about this investment. Sellers and Realtors prefer working with potential buyers that are pre approved with a lender. It will also help narrow down your options and guide you in the next steps — ensuring that you can actually afford the homes you tour.

Step Six: Decide whether you’d like to work with or without a real estate agent

The process of touring multiple properties can be overwhelming. Fortunately, a real estate agent can help. Agents are experts at helping people find the right property. They will guide you through all of the options that meet your specific criteria while walking you through the next steps of the deal.

Step Seven: Tour homes, decide, and make an offer!

With your pre-approval letter in hand and a real estate agent by your side, you can tour homes in confidence. Visit the properties more than once and take your time deciding on which one to purchase.

Once you have found what you like and have made a final decision, proceed by submitting a formal offer to the seller.

Step Eight: Get a home inspection

Once the buyer and seller have come to an agreement, it’s time to conduct the property inspection.

This is when a professional inspector will check the property for structural damages or anything else that needs fixing. Your real estate agent takes care of this, if needed. If the inspection reveals significant damage, it can lead to renegotiation or withdrawal of your offer without penalty.

Step Nine: Start your new purchase application with Milo

Once your offer is accepted and the home inspection has revealed no major damage, you’ll come back to Milo — your lending solution.

This is the point where you start your New Purchase Application by submitting all of your documents and information.

Oh, and did we mention that everything is done from the comfort of your own home? Our process is fully online!

You’ll need the following documents to apply:

a. Passport and U.S. Visa

b. Certified Public Accountant letter

c. Bank statements

d. An active U.S. bank account (remember we recommended setting one up at the beginning? This bank account is expected to have 12 mortgage payments, on average.)

If you decide to title the property as a Corporation, you’ll also need:

a. Articles of incorporation

b. Operating agreement and bylaws

c. Certificate of good standing

Once you finish submitting all of your documents, one of our Loan Consultants will be reaching out to you. They will guide you through the rest of the process and keep you updated on any new information regarding your loan approval.

At this point, you may be asking yourself, “what if I need help during my application process?” Our Loan Consultants are here to help. Contact them at loans@milo.io, or call (888) 433-6456.

Step Ten: Close your deal

With any other lender, foreign nationals spend months waiting for an answer.

With Milo, in a few weeks you’ll have done the entire job! You can expect an approval from our side. We have approved 89% of our borrowers, so the possibilities are in your favor.

If you have any questions throughout the process, our Loan Consultants are here to help. Milo offers personalized guidance. Most of the work is done digitally — meaning there is no traveling every couple of weeks to attend endless meetings.

Getting approved with Milo is easy. Remember, we are specifically crafted for you. With Milo, you can Unlock What’s Possible. To learn more about us and our loan types, click here.

The opinions expressed in the Blog are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product.