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In order to make full use of the principle of financial leverage and maximize investment returns, many investors use loans as much as possible instead of using their own funds when conditions permit. Another advantage of buying a house with a loan is that the interest and loan fees can be deducted from personal income tax, so even high-income groups are more willing to choose to buy a house with a loan from the perspective of tax avoidance.
The following documents are basically required
- Passport (this is required)
- Proof of income (annual salary statement)
- Tax return
- Proof of resident identity
- Personal credit record
- US bank account
In addition to the basic documents mentioned above, there will be various other supplementary document requirements, such as proof of employment and proof of rental income.
It is particularly important to point out that it is quite popular among Chinese people for their children to buy a house, and parents often give their children some money as part or all of the down payment. In this case, the lending institution will require the applicant to produce a "gift certificate" to prove that the cash is a gift and not a loan, because if it is a loan, it will involve the loan amount of the US mortgage lending institution and the applicant's repayment ability.
You can apply for a mortgage loan in the United States in many places, because there are many institutions that issue mortgage loans in the United States, not only banks, but also many companies that specialize in handling mortgage loans in the United States. In addition to accepting face-to-face loan applications, these banks and companies also have dedicated telephone services and online services. You can complete the mortgage application by phone or the Internet, which is very convenient.
As the amount of cash held increases, many Chinese buyers intend to repay their mortgages in advance. So, can mortgages in the United States be repaid in advance?
Early Repayment Process
First, the borrower should check the loan contract for early repayment requirements and pay attention to whether early repayment requires a penalty.
Second, call the lending bank to inquire about the early repayment application time, required information, etc.;
Third, apply for early repayment at the relevant department according to the requirements of the lending bank;
Fourth, the borrower takes relevant documents to the lending bank to go through the early repayment procedures;
Fifth, deposit the early repayment amount into the repayment account and wait for the bank to deduct it, or bring cash directly to the loan bank to repay.
Should I Pay It Back in Advance?
Those who are currently in the early stages of repayment can consider paying off their mortgage early.
Since the buyer is in the early stage of loan repayment, the principal base is large and the interest is high in the first few years of the loan; therefore, when the buyer has a large amount of idle funds and has no better investment channels, it is better to repay the loan in advance. However, it should be noted that it is not recommended to pay off the loan all at once within 6 months after the loan is approved.
Compared to paying off the loan all at once, buying another house is a wiser investment path. With the same amount of money, you can own two investment properties, retaining both the appreciation of the property and collecting rent.
Lenders who implement floating interest rates may consider paying off their mortgage early.
If the floating interest rate is below 3 years, it will be relatively cost-effective for such borrowers if they are able to pay off the loan early. If you cannot pay off the loan early, it is recommended to refinance and lower the interest rate. The 5-year and 7-year loans can be decided based on economic trends and your own financial situation. Don't worry about not being able to pay off the loan when it is due. Refinancing is a good solution.
A longer loan period will result in lower monthly payments and free up more liquid cash for other investments; however, longer mortgages require buyers to pay more interest. Therefore, people who purchase real estate with loans should take advantage of the good economic momentum in the United States and consider the advantages of buying another property as an investment and financial management method based on their own financial strength, and comprehensively consider whether they should repay the loan in advance. Sometimes repaying the loan in advance is not the best way to allocate assets.
