What is an Asylum Seeker?
Suppose you have arrived in the United States and are afraid to return to your home country because of your race, religion, political opinion, nationality, or because you belong to another type of persecuted group in your home country. You may arrive in the USA wondering can asylum seekers buy a house.
In recent years, the U.S. has received hundreds of thousands of asylum applications seeking protection in the U.S.
One of the benefits of living in the U.S. as an asylum seeker is the ability to purchase a house. Asylum seekers who reside in the U.S. for at least a year can apply for a temporary residency permit, also known as a green card. Buying a house allows asylum seekers to participate in the economy, develop their U.S. credit history, and establish themselves while they go through the application process for their green card or another temporary residence permit.
Can Asylum Seekers Buy a House?
Asylum seekers are looking to make the U.S. their home, so it’s only natural that they would want to buy a house and settle down. Around 2.5% of all houses purchased in the United States in 2022 were bought by foreign buyers, including asylum seekers.
It is legal for asylum seekers to purchase a home as long as they qualify for a mortgage. There are, however, some specific requirements and rules that asylum seekers might need to follow when completing the home-buying process.
Asylum seekers can apply for a green card after one year of residency, making the mortgage application process much easier. However, they may also use Form I-94A or other official documentation to apply.
Types of Properties Asylum Seekers Can Buy
Asylum seekers can purchase real estate in the U.S., provided they qualify for a mortgage. This includes residential properties like houses, condos, townhouses, duplexes, and apartments. They can even purchase land and build if they choose. There are no formal legal restrictions that prohibit asylum seekers from buying these types of properties.
Asylum seekers can also purchase vacation homes and rental properties, provided they have the required legal documentation and necessary finances.
Home Loans for Asylum Seekers
The most important part for asylum seekers to consider when buying their first home is applying for a home loan. The first step is choosing a reliable lender who is willing to work with non-permanent as well as permanent residents. Permanent residents can present a green card and a Social Security Number (SSN), while non-permanent residents only have an work permit and SSN. As long as the applicant lives in the United States, most lenders will consider them less of a default risk and will be willing to work with them to finance their home.
Residency status will be a factor in determining the type of mortgages available to asylum seekers. Asylum seekers qualify for the following types of mortgages:
- Conventional Mortgages
- Asylum seekers can qualify for conventional mortgages backed by Fannie Mae or Freddie Mac. These mortgages have down payment rates as low as 3% for a single-unit primary residence. Some mortgages allow applicants to avoid monthly payments if they make a down payment of 20% or more.
- This option does require 1-2 of legally documented work history and a medium FICO® of 620.
- Federal Housing Administration Loans (FHA Loans)
- FHA loans are a good option for asylum seekers because they don’t require a good credit history.
- FHA loans require an upfront mortgage payment and consistent monthly payments for at least 11 years.
- The down payment rate is 3.5%. FHA loans require at least two years of documented work history and a FICO® score of 620 or higher.
Required Documentation for Asylum Seekers
Asylum seekers will typically be asked for additional documentation to complete the home buying process, compared to U.S. citizens. The exact documents will depend on the buyer and whether they are using cash or applying for a mortgage. Asylum seekers should note that mortgage lenders can request any documents necessary so the requirements can vary from lender to lender. However, there are some general requirements that all asylum seekers will need to fulfill when buying a house in the U.S.
Here are some of the basic requirements required when buying a home in the United States:
- A valid photo ID such as a foreign passport, U.S. visa, or driver’s license
- A Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN)
- Employment Authorization Document
- Proof of income (pay stubs or bank statements) or financial assets
- Financial statements from a bank in the asylum seeker’s home country
- Any applicable U.S. tax returns
Asylum seekers will specifically need to submit one of the following documents as well:
- An Employment Authorization Document (EAD)
- A Form I-94A with a valid employment authorization stamp
- Any official document issued by U.S. Citizenship and Immigration Services that shows proof of the applicant’s employment and residency rights
Asylum Seekers and U.S. Credit
Building credit is necessary for obtaining a mortgage to purchase a home in the United States. Any foreign national that arrives in the U.S., including asylum seekers, will face the issue of having little to no credit history. Fortunately, asylum seekers can build up their credit over time by frequently using a credit card and making payments or financing a large item like a car.
The better an asylum seeker’s credit score is, the better the available home loans. Some may be able to get a great home loan without a well-established credit history by making a sizeable down payment on their home. However, most asylum seekers should focus on building their credit score as soon as they arrive on U.S. soil.
More uncommon is converting foreign credit to contribute to U.S. credit history. Lenders are rarely equipped for this process, but not impossible.
Along with meeting the standard employment and credit history requirements, credit conversions can be processed by submitting the following documents:
- A valid Social Security Number (SSN)
- Valid proof of income, like pay stubs.
- The contact information of four up-to-date credit references that each have a two-year history with the applicant. One reference must be from the applicant’s current housing.
- Valid bank account statements.
Qualifying for a Home Loan As an Asylum Seeker
All applicants for a home mortgage in the U.S. must prove their residency status, even asylum seekers. Legal residency is one of the most critical factors for determining mortgage eligibility. Non-permanent residents like asylum seekers should ensure they can present employment authorization documents to make the mortgage process go much more smoothly.
Proving Foreign Assets and Income
Asylum seekers should verify any foreign income they bring to the U.S. if possible. This can be done either through a third party or on a U.S. tax return. This can assist with qualifying for a home loan. Otherwise, lenders will only be able to rely on the applicant’s U.S. credit and work histories.
FAQs For Can Asylum Seekers Buy a House in the USA
Can I buy a house in the U.S. while I'm still awaiting an asylum decision?
How can I get a mortgage with asylum status pending?
Can asylum seekers get an FHA loan?
How can asylum seekers earn U.S. credit?
Asylum seekers in the USA face many challenges, including limited access to government benefits and financial services, they are not categorically prohibited from buying a house.
With the right legal and financial resources, as well as the support of organizations and advocates that specialize in assisting refugees and asylum seekers, it is possible for asylum seekers to achieve homeownership in the USA.
The process is not without its obstacles, and it is important for asylum seekers to be aware of their rights and options as they navigate the complex legal and financial landscape of the US housing market.
Ultimately, the ability of asylum seekers to buy a house depends on a range of factors, including their legal status, financial situation, and access to resources and support networks. For those who can achieve homeownership, it can be an important step towards stability, security, and a sense of belonging in their new home country.
If you have any questions, please contact our office and schedule a time to talk to an immigration attorney.