A brief introduction to obtaining a Canadian commercial mortgage in the USA.

Owning commercial property in the United States is the dream of almost every Canadian citizen living in the United States. Many of them have no idea how to obtain commercial financing or a mortgage. Certainly, buying commercial property in the US presents its own challenges, if you are not a US citizen, but a Canadian. According to a survey by the National Association of Realtors (NAR), more than half of property transactions are done in cash in the US.

However, commercial mortgage lenders are willing to extend credit to Canadian citizens on attractive terms. Sometimes these lenders even give them credit without a credit history in the US Obtaining a commercial mortgage depends on the residential status of the Canadian citizen. Canadian borrowers can be classified into the following categories based on their residential status.

  • Non-permanent residents with a valid work visa (G1-G4, E1, E2, H1B, L1, H3, H2B and H2A)
  • Permanent Residents with a Green Card (Form 1-551)
  • Foreign nationals whose residence is not in the US.

Pay the mortgate

If you are a Canadian citizen who wants to buy commercial property in the US, then be prepared to pay more for your commercial mortgage, as US mortgages are compounded monthly compared to commercial mortgages in Canada, which are calculated semi-annually. In addition to this, there may also be tax deductibles in the United States for its permanent residents. Whereas, there is no such tax deductible available to Canadian citizens interested in purchasing commercial property in the United States by obtaining commercial mortgage financing.

How to apply for a mortgage for Canadian citizens?

Canadians can apply for a business loan in the US remotely by email or over the phone, if they don’t mind some long distance charges. Most lenders and brokers strongly recommend that Canadian citizens have a business bank account in the US through an ITIN (Individual Tax Identification Number) to facilitate financing of finances and transfer of initial payments for closing.

Some of the reputable lenders offer secured mortgages of up to 75% loan to value (LTV) at very competitive interest rates. Canadian citizens can make use of these finances in all 50 US states.To achieve maximum customer satisfaction, these transactions are closed in 30-45 days. The closing of a Canadian citizen’s mortgage must be done in person in the United States, preferably at the offices of commercial loan lenders.

Documents necessary for the mortgage processing?

  • Legible copy of valid Canadian passport
  • Copy of Canadian credit report
  • Fully legible purchase-sale contract signed by all parties Verification of funds or deposit
  • 3-month bank statements showing you have sufficient funds for a purchase
  • Personal financial statement indicating assets and liabilities
  • Professional CPA and Personal Banker Reference Letter
  • Sponsor bio or resume describing past ownership and experience in managing such a significant investment
  • property if it is more than $ 1M. + investment
  • Real Estate List of Existing Real Estate in the US or Canada
  • Copy of U.S. Individual Tax Identification Number
  • Copy of the security deposit or letter of guarantee deposit
  • Canadian primary residence

The final thought

Many business loan brokers and home loan companies in the US offer business loans to Canadian citizens after verifying their financial history, residency status, and employment history.

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