Author: Premela R.

Wholesale Lending and Why it’s Important!

Wholesale Lending - Mortgage Brokers USA

Key takeaways:

  • A wholesale mortgage lender is an institution that funds mortgages and offers them to third parties, such as a mortgage broker, bank, or credit union
  • Non-bank lending accounts for about half of all U.S. mortgage origination
  • Wholesale mortgage lending differs from other mortgage options in that it requires the borrower to work with a mortgage broker instead of the lender
  • Wholesale lenders can offer cheaper rates and more relaxed eligibility guidelines compared to traditional lenders 
  • America Mortgages is the only U.S. mortgage broker outside the U.S. that focuses 100% of their business on Foreign Nationals and Expats living overseas

Wholesale Lending, Mortgage Brokers.... and Why It’s Important for International Clients 

The concept of wholesale lending is not understood outside the U.S. but actually accounts for about half of all mortgage origination in the U.S. 

One way to think about a wholesale lender is a bank that does not take customer deposits and only buys and sells mortgages.

A research article by The Ascent highlights the presence of non-bank financial institutions as the top three largest mortgage lenders in the U.S.

According to The Ascent's analysis of the top 25 mortgage lenders, 72% are independent mortgage companies, and 28% are banks!

Thanks to a regulation called Dodd-Frank after the financial crisis, retail banks only focused on “Prime” borrowers since these mortgages eventually would be sold to Fannie Mae, a government-linked entity providing liquidity to the mortgage market.

Prime borrowers are U.S. citizens with very good U.S. credit who hold high-earning, long-tenured, salaried jobs and borrow for their primary residence. Nearly all other types of borrowers fall under wholesale mortgages.

This includes our clients => international borrowers, both foreign nationals and overseas expats!

The Customer Journey

Whether it's a purchase loan or a refinance - retail lenders work directly with individual borrowers, while wholesale mortgage lenders don’t. 

Instead, they partner with mortgage brokers, who work with you to find the right loan — often at a discounted rate — and prepare your application.

America Mortgages => The world’s only U.S. mortgage broker with a 100% focus on Foreign Nationals and U.S. Expats!

What is a wholesale mortgage lender?

A wholesale mortgage lender is an institution that funds mortgages and offers them to third parties, such as a bank, credit union, mortgage broker, independent mortgage company, or professional.

How wholesale lending works

In wholesale lending, the borrower doesn’t have direct contact with the lender; instead, the borrower interacts with the third-party mortgage broker, who is responsible for facilitating the loan origination and application process and communicating throughout the lender’s underwriting. The mortgage broker works for the clients, and not just one bank or wholesale lender. This gives the clients more options of loan programs and qualifications.   

A wholesale lender lets mortgage brokers know what the loan options and terms are, and the third party then matches borrowers with an appropriate loan.

Once the loans close, wholesale lenders typically sell them in the secondary mortgage market to free up capital to fund more mortgages.

When working with America Mortgages, you gain access to our extensive network of over 50 wholesale lenders and will have access to competitive rates and more flexible loan options and requirements.

If you're seeking the best mortgage rates and expert guidance through the lending process, opting for the broker and wholesale lender route is your best choice. 

America Mortgage's sole focus is on overseas borrowers and we have the knowledge and experience to meet your specific needs. This is all we do!

The role of mortgage brokers in wholesale lending

You’ll work with our international-based loan officers to complete each step in the application process. Once your application is ready for review, we will coordinate with the wholesale lender’s underwriting team for a pre-approval in 72 hours.

You can then use the pre-approval to show proof of financing when you start house-hunting.

Our job as a mortgage broker doesn’t stop with assisting the prospective borrower with their mortgage application. 

We will also work to find you the best deal on a mortgage. Since we will have access to loan programs specifically designed for overseas borrowers, you will be able to secure more competitive rates and terms than you would if shopping for a home loan independently.

More importantly, since we understand the requirements of foreign borrowers significantly better than any U.S.-based mortgage broker, our team will be more effective and efficient in guiding you through the entire loan process.

Wholesale mortgage lending process

Below is an overview of what to expect if you decide to work with one of our internationally-based U.S. loan officers:

  • Step 1: Connect with our International Loan Officers to complete a standard loan application 1003 and gather documentation the wholesale lender needs to make a decision
  • Step 2: The mortgage broker confirms your application is complete and submits it to the wholesale lender for review
  • Step 3: Upon receipt, a member of the wholesale lender’s underwriting team analyzes your loan application, along with the supporting documentation, and verifies the entries to make a lending decision
  • Step 4: Once your application is approved, the mortgage broker provides you with a commitment letter from the wholesale lender detailing the loan terms and any applicable conditions
  • Step 5: The mortgage broker coordinates with the wholesale lender to close and fund your home loan. If there are any conditions the borrower must satisfy for the loan to close, the mortgage broker notifies the borrower during this step
  • Step 6: Once all conditions are met, the wholesale lender issues the “clear to close” to the mortgage broker, and the broker notifies the borrower. The borrower sends their down payment and the funds for closing costs to the title company shortly before closing
  • Step 7: At closing, the borrower signs the loan documents at the local embassy to finalize their end of the transaction and mails the documents to the title company
  • Step 8: The wholesale lender closes and funds the home loan

Key points of wholesale mortgage lending

  • A mortgage broker will search for the best loan option from a network of wholesale lenders
  • Less stringent eligibility guidelines
  • Potentially access more competitive rates and flexible loan terms
  • Personalized support from a mortgage broker
  • No direct contact with the lender
  • Mortgage broker fees  
  • Higher likelihood of loan sell-off following closing

Is wholesale mortgage lending right for you?

Getting a mortgage from America Mortgages is your only choice outside the U.S. if you are a non-resident foreign national or overseas expat looking to purchase an investment property or second home. 

A U.S.-based mortgage brokers WILL NOT know the ins-and-outs of borrowers living overseas, but THIS IS ALL WE DO - and we are in your time zone and speak your language!

Here are our popular U.S. loan programs. 

In conclusion, understanding the dynamics of wholesale mortgage lending is crucial for international clients, especially non-resident foreign nationals and overseas expats.

At America Mortgages, we navigate this landscape with over 50 established relationships with wholesale lenders, offering you access to competitive rates and flexible loan options.

If you're seeking the best mortgage rate and a guided lending process tailored to your international needs, reach out to us today to take the first step toward securing your U.S. property with confidence.

New Mortgage Launch: AM Rental Coverage Plus

New Mortgage Launch - International Mortgage

We absolutely LOVE the unique advantages the U.S. mortgage market has to offer over any other country. However, we get even more excited when we launch a new mortgage loan program such as the AM Rental Coverage Plus! 

As a company, we focus on providing our foreign national and U.S. expat clients with the most comprehensive mortgage programs available. America Mortgages wants to be your long-term partner on your real estate investment journey. Whether you’re looking to refinance an existing U.S. property or build a real estate portfolio for retirement or legacy, we are with you every step of the way. 

Before introducing AM Rental Coverage Plus, let’s break down the advantages America Mortgages currently offers to their clients;

  • No age restrictions on loan tenure: Maximize your yield potential with 30–40-year amortization. Regardless of whether you are 19 or 99, you can qualify for the longest tenure possible. (This is a U.S. government anti-discrimination policy)

  • No limit on the number of properties owned with maximum LTV financing: We understand building a real estate portfolio requires leverage. America Mortgages’ loan programs allow you to obtain the maximum LTV available regardless of the number of properties owned.

  • 40-year loan program with 10-year fixed interest only: America Mortgages features a 40-year amortization on many of our loans. The 10-year interest-only option is a fantastic way to lock in a long-term fixed rate with the flexibility to keep it for 40-years without seeing any adjustment in rate. Rates go up, your payment remains the same. Rates go down; refinance into a lower rate or stay with the comfortable payment you have locked in. It’s that flexible!

  • Refinance when rates go down: When rates decrease, your America Mortgages loan officer will analyze the lower rate options and present a clear and concise proposal that shows a breakeven point for any costs incurred in the refinance. 

  • Loan programs in all 50 U.S. states: Our loan programs are available in every city and state. Want to buy a condo on the beach in Waikiki, Hawaii, or refinance a single-family home in Houston, Texas — We have loan programs.

  • No U.S. credit required: Our loan programs do not require the borrower to have U.S. credit. We’re able to use your home country credit if available. If you don’t have a credit reporting agency in your home country, no problem – speak with one of our U.S. loan officers for an exception. We do it all the time.

  • U.S. expat loans with no W2 and foreign earned income: Are you a U.S. expat and feeling the frustration of no W2 or foreign earned income? These are not problems for America Mortgages. For U.S. expats, we make it as easy as if you were living and working in the U.S. and walking into your local bank. There is no premium in pricing, and it’s truly that easy.

  • Free pre-approval letters in 72 hours: The first thing we recommend for anyone looking to purchase a property is to get pre-approved. This is for a couple of reasons: 1) You should fully understand and be comfortable with the mortgage loan term and tenure you’re obtaining 2) You will need a pre-approval rate before any offer on U.S. property will be taken seriously. Don’t have a realtor? No problem: our comprehensive and complimentary realtor referral program can place you with a vetted and qualified realtor all around the U.S.

Now to the exciting part…AM Rental Coverage Plus!

America Mortgages has common sense underwriting loan programs, including loan programs that allow our clients to qualify only on the rental income of the property and not personal income. This is how commercial cash-flowing mortgages have been underwritten for years, and it makes perfect sense. The property is being purchased as an investment, and the rent from this investment will be used to pay the monthly mortgage debt. The standard ratio has been 1:1. This means if the rental income is sufficient to cover the mortgage payment, taxes, and insurance on a one-to-one basis, the loan qualifies. This is fantastic. However, this doesn’t take into consideration that mortgage rates tend to be fixed, and rental rates increase. Until now …

Introducing AM Rental Coverage Plus, which allows you to qualify on a 0.75:1 ratio. In simple terms, as long as the rent covers 75% of the mortgage payment, taxes, and insurance, the loan qualifies. It just makes sense!

Here's a simple example:

Rent: $750/month

Mortgage payment (tax, insurance) $1,000/month

Ratio: .75:1 (75% rental coverage)

Approved: YES!

For more information on the AM Rental Coverage Plus loan program, as well as our other America Mortgages loan programs, please email hello@gmg.asia or schedule an appointment to speak with one of our U.S. loan officers today.

America Mortgages only works with foreign nationals and U.S. expat investors; this is all we do, and no one does it better. Whether you're a seasoned investor or just starting to build your portfolio, our loan programs open doors previously closed to many. Seize this opportunity and discover how America Mortgages can be your steadfast partner in realizing your real estate dreams. Contact us today to learn more and embark on your journey to financial success.

Top 5 U.S. Record-Smashing Luxury Home Sales of 2023

Despite the overall decline in home sales in 2023 due to increased interest rates, high-net-worth U.S. real estate investors remained active in the luxury market. In the third quarter of 2023, the luxury market outpaced the mainstream market, growing three times faster. According to Jason Aleem, Redfin's Senior Vice President of Real Estate Operations, paying cash “helped wealthy buyers weather the storm of high mortgage rates.” A recent Redfin report noted that 42.5% of luxury homes sold in the third quarter of 2023 were purchased outright in cash, “others are choosing to take on a higher rate and refinance later - an expensive option that isn’t feasible for a lot of lower-income consumers,” Aleem explained. 

We’ve compiled the top 5 record-smashing luxury sales based on Jonathan Miller, President and CEO of appraiser Miller Samuel’s annual list.

Notably, 2 of the 5 properties were located in Palm Beach, Florida. This highlights Palm Beach County in South Florida as a consistent and attractive investment destination for luxury property investors. The real estate market in the region is robust, with luxury properties demonstrating a history of appreciation over time.

1. $190 million - 27712 Pacific Coast Highway, Malibu, California

Source: Zillow

Beyoncé and Jay-Z set a new record in California real estate with their recent purchase. The property, designed by Tadao Ando, includes 7 bedrooms and 11 bathrooms, sits on 8 acres, and features a private beach and an infinity pool overlooking the Pacific Ocean.

2. $170 million - 589 North Country Road, Palm Beach, Florida

Source: Addison Development Group

The property, spanning 24,131 square feet, boasts 8 bedrooms and 12 bathrooms. Situated on 1.6 acres, it includes 150 feet of direct oceanfront. This off-market sale involved Robert Stiller, founder of Green Mountain Coffee Roasters, and luxury car dealer Michael Cantanucci. Stiller and his wife reportedly purchased this property for $25 million a decade ago, illustrating South Florida’s remarkable property appreciation.  

3. $155 million - 1495 North Ocean Boulevard, Palm Beach, Florida

Source: Zillow

Estée Lauder cosmetics founder William Lauder purchased this 2.7-acre oceanfront property in an off-market sale from the widow of Rush Limbaugh. The property has 5 bedrooms, 20 bathrooms and 4 guest houses, with approximately 250 feet of ocean frontage and direct access to the beach. Limbaugh had initially purchased the property in 1998 for $3.9 million, serving as a testament to South Florida’s property value appreciation. 

4. $138.8 million - 499 Indian Field Road, Greenwich, Connecticut 

Source: Sotheby's International Realty

Hedge fund billionaire Ray Dalio acquired the 50-acre property, boasting 8 bedrooms and 10 bathrooms. With nearly a mile of waterfront offering views of Long Island Sound, the property includes luxury amenities like a 75-foot heated swimming pool, tennis court, and two private beaches.

5. $112.5 million - 700 Meadow Lane, Southampton, New York

Source: Trulia

Nestled on 8 acres between the Atlantic Ocean and Shinnecock Bay, this 15,521-square-foot property boasts 500 feet of ocean frontage, offering stunning water views from every room. With 11 bedrooms and 12 bathrooms, it includes amenities like a private boardwalk to the beach, an indoor gym, and basketball and tennis courts. 

America Mortgages – HNW Foreign National and U.S. Expat Mortgage Experts

At America Mortgages, we specialize in assisting foreign nationals and U.S. expat investors in securing financing for luxury real estate ventures in the U.S. Our commitment to streamlining the financing process for foreign nationals and U.S. expats sets us apart. For our high-net-worth clients, we provide flexible lending options, including fixed interest-only loans and loans with non-traditional income documentation - suitable for entrepreneurs and business owners.

Join us in exploring the robust luxury real estate market with practical solutions tailored to your financial goals. Visit www.gmg.asia or reach out to us at hello@gmg.asia to steer your real estate journey.

How Can Singaporeans Obtain a U.S. Mortgage?

Singapore Mortgages

Singapore is known for academics and education, with many high school graduates attending the best universities in the world!

Similarly, the U.S. is known for having most of the top global universities.

Singapore currently has 21,666 students studying abroad, according to UNESCO, and according to a recent Open Door report, Singapore had 3,901 students studying in the U.S. – a record number!

A typical Asian family will want to explore owning a property near the university the child will be attending – as a place to stay when visiting or if the student prefers not to stay in the dormitory.

After graduating, the property’s value often goes up. It might be enough to pay for college, or parents might choose to give the property to their child if they plan to work in the U.S. before returning home. This allows the child to build credit, something very important in the U.S.

However, not many can pay for a home with cash and just give up when they assume that obtaining a mortgage is not available. 

Contrary to what you may think…..

  • You CAN get a mortgage as a non-U.S. citizen or Expat living in Singapore
  • You DO NOT need U.S. credit or residency
  • You CAN QUALIFY based on your Singapore income OR by using the rental income of the U.S. investment property   
  • You CAN get market-interest rate mortgages while living in Singapore 
  • You CAN sign the closing documents at the embassy on Napier Road

Actually, we are the world’s first and only U.S.-based mortgage broker with offices in Singapore, right on Telok Ayer. Come visit us for coffee! 

Let us guide you through this process from: 

  • Introducing you to a realtor
  • Helping you screen for the best locations to buy
  • Setting up your LLC
  • Discussing the benefits of using an LLC
  • Introducing you to a property manager

[Must Sign Up!] A Singapore Couple’s Path to Financial Freedom through U.S. Real Estate Investing! 

Meet Han and Tracy, an incredible couple from Singapore who made a bold move – they left behind their regular 9-5 jobs after successfully diving into the world of U.S. real estate. Now, proud owners of 12 cash-flowing properties, achieved through strategic moves in just three years, they’re here to share their story.

Register for our exclusive webinar “Singapore Couple’s Journey to Financial Freedom through U.S. Real Estate Investing,” on January 18th at 6:30 PM SGT. Join Han and Tracy as they unravel the details of their transformative journey. Learn the secrets of how this dynamic duo achieved financial freedom through their savvy investments in U.S. real estate. Don’t miss out—reserve your spot now!

AM Student+ 

Investing in your child’s future just got easier. America Mortgages’ Student+ loan program removes the financial barrier for parents who want to purchase a property in the U.S. for their children’s education. This innovative program allows parents to qualify for a loan using the projected rental income of the property, eliminating the need for a U.S. credit history. This means that even parents who are new to the U.S. can provide their children with a safe and comfortable place to live while they study.  

With America Mortgages’ Student+ loan program, parents can invest in their children’s future and build wealth at the same time. The program’s flexible terms and competitive rates make it an attractive option for investors. Contact us today to learn more about this unique program and start investing in your child’s bright future.

hello@gmg.asia

A Secret Strategy Top Real Estate Investors Use

International Mortgage

A secret many wealthy U.S. real estate investors use is the practice of holding properties within an LLC. 

Using an LLC to hold real estate for investments has almost become a given with many tax benefits, liability protection, and acceptance by lenders. If you think about it, any company earns revenue, and in this case, LLC’s revenue comes from the rental income of the property. Also, like any company, you have operating expenses related to running the company (your company-related tax deductions) – more on this later. 

In this article, we’ll break down how an LLC operates and dive into the advantages of opting for an LLC when dealing with rental properties.

Opening an LLC

An LLC not only shields you from liabilities but also brings in tax advantages. This offers a seamless and flexible approach to handling your investment efficiently.      

Process: 

  1. Choose a State:
    Decide in which U.S. state you want to establish your LLC. Each state has its own rules and regulations regarding LLC formation.
  2. Name Your LLC:
    Choose a unique and compliant name for your LLC. It should comply with the naming rules of the state.
  3. File Articles of Organization:
    Submit the required paperwork, usually called the Articles of Organization, to the appropriate state agency. This is often the Secretary of State’s office.
  4. Operating Agreement:
    While not always required, it’s advisable to create an operating agreement that outlines the structure and operation of your LLC.
  5. Obtain an EIN:
    Apply for an Employer Identification Number (EIN) from the IRS. This is like a Social Security Number for your LLC and is necessary for tax purposes. 
  6. Bank Account:
    Once your LLC is approved, you can open a business bank account. While banks do not help in the formation of the LLC, they are crucial for managing your LLC’s finances.

The benefits of using an LLC to hold a rental property

  1. Single or Multiple Members Allowed
    An LLC allows for flexibility in membership, accommodating either a single member or an unlimited number in a multi-member LLC. This flexibility enables individual investors to enjoy an LLC’s benefits and protections. However, if the LLC is treated as an S-Corporation for tax purposes, there is a 100-member limit.
  2. Pass-Through Entity for Tax Purposes
    An LLC is treated as a pass-through entity for tax purposes, meaning profits or losses flow through to each member based on their ownership percentage. Members report income or loss on individual tax returns and pay taxes based on personal income tax rates.
  3. Flexible Pass-Through Structure
    While LLC profits and losses are generally distributed based on ownership percentages, members can agree to a different allocation in the operating agreement. For instance, a member in a higher tax bracket might seek a larger percentage of the depreciation expense for a more substantial tax write-off.
  4. Management Flexibility
    The operating agreement of an LLC can be tailored to allow management flexibility. For example, one member with property management expertise may handle daily property details, or the operating agreement may mandate that all members vote on significant decisions like refinancing or sale of the property.
  5. One LLC for Each Rental Property
    Many investors opt to establish a separate LLC for each rental property they own. This adds an extra layer of protection by isolating potential claims against one property from the entire real estate portfolio for those with multiple rental properties. 
  6. Contribution of Personal Assets
    Members have the option to contribute personal assets, such as real property or funding, to an LLC. The LLC can also pay reasonable interest to members for loans until the borrowed money is fully repaid.
  7. Easy Transfer of LLC Interests
    Shares in an LLC may be sold or transferred to new members based on the terms outlined in the operating agreement. Real estate held under an LLC can remain within the LLC’s control even when under new members.
  8. Professional and Business-Like Image
    Holding rental property under an LLC provides real estate investors with a more professional business appearance. This could enhance credibility with tenants, lenders, and vendors.
  9. Inexpensive and Straightforward Formation
    Depending on the state forming an LLC can be a relatively simple and cost-effective process, from $50 to a few thousand, depending on the state. 

Certain states impose a minimum annual LLC tax, require annual reporting fees, and may necessitate payment of registered agent fees to an agent for service of process in the state where the property is located.

Choosing an LLC to hold a rental property can shield an investor’s personal assets in case of a lawsuit. Typically, in a legal dispute, only the business assets would be at risk, offering a protective barrier for personal belongings.

What is the best state to form an LLC in? 

While forming an LLC in your home state is typically advantageous, there are exceptions for non-residents and specific LLCs. Non-U.S. residents have the flexibility to choose any state, with Wyoming and Delaware being recommended options. For real estate LLCs, the “home state rule” doesn’t apply. According to doola.com, Delaware provides business owner anonymity, as it doesn’t require the owner’s name on entity formation documents. Wyoming allows listing a “nominee” as the LLC owner for added privacy.

Pre-Approval Process

Launch your U.S. real estate investment journey confidently with America Mortgages’ 72-hour pre-approval process. Our team simplifies required documentation and timeframes, providing solid assurance. House shopping is much easier when you have an official lender pre-approval.

Tax Considerations

Effortlessly navigate tax complexities with America Mortgages’ tax partners. Understand all the tricks that billionaire real estate investors use to minimize tax liability and maximize profit potential. Consult with our tax professionals for an optimized strategy.

Property Management

Ensure remote property maintenance with America Mortgages’ property management partners. Our team connects you with reliable day-to-day management, offering peace of mind even when you’re not physically present.

Legal Assistance

For smooth transactions as a foreign investor, legal advice is crucial. America Mortgages connects you with experienced professionals for essential guidance.

Property Insurance

Protect your property with suitable insurance through America Mortgages’ trusted partners. Obtain the right coverage for a well-structured risk management strategy, ensuring peace of mind for your investment.

Stay Informed

Stay updated on U.S. real estate changes and regulations affecting foreign investors. Continuous education is essential for informed decision-making and adapting to evolving market conditions.

Navigate your U.S. real estate investment journey with America Mortgages. Together with our partners, we provide comprehensive support from swift LLC formation and a 48-hour pre-approval process to tax expertise and reliable property management. Let us guide you in developing clear exit strategies and staying informed about market changes. Trust America Mortgages for a seamless and informed U.S. real estate investment experience. Contact us today at hello@gmg.asia for a seamless investment experience.

www.gmg.asia

Canadian Real Estate Outlook for 2024

Australia Mortgage Rates

Did you know we have a very active Canadian mortgage business with teams based in Vancouver, Calgary, and Toronto?

Here is an updated copy of our GMG Canada Loan Program

Canadian Real Estate Outlook for 2024…eh!

Like its southern neighbor, we've watched the Bank of Canada hike up their benchmark interest rate. Now, there's talk that maybe, just maybe, the housing market's rough ride could smooth out in 2024. But predicting exactly when this will happen and how strong the rebound will be isn't easy. It's got a lot of us on the edge of our seats, wondering if it's the right time to jump into the market.

The central bank's rate is like the heartbeat of Canada's housing market. If the predictions are right and we see interest rate cuts in 2024, it could be a break for those itching to buy a home. But it's not all sunshine and rainbows yet. Despite the Bank of Canada hitting a pause on rate hikes for a bit, a survey by Ipsos for Global News found that a whopping 73% of Canadians feel locked out of the housing market because of these high rates. It's especially tough for millennials and folks in British Columbia and Quebec.

Darrell Bricker at Ipsos Global pointed out to Global News that while these high borrowing costs are a barrier, they might also nudge some sellers who can't keep up with their mortgage payments to sell.

As for the 2024 housing market, Robert Hogue from RBC thinks we might see some action before the busy spring season. But high borrowing costs could keep a lid on things in the first half of the year. If mortgage rates tied to bonds start to dip, we might see some buyers, especially investors, jumping in.

Hogue doesn't think sellers will flood the market, even though a lot of folks will have their mortgage terms ending. He believes the mortgage stress test should help prevent a wave of forced sales. He's expecting a bit of a boost in demand if we see interest rate cuts, but nothing crazy until borrowing costs really start to drop.

Over at Royal LePage, they're also predicting a pick-up in sales and prices in the second half of 2024. They even think home prices could get close to their pandemic peak by the end of the year.

Phil Soper from Royal LePage says there's a lot of pent-up demand. A drop in interest rates could be the sign people are waiting for to feel confident that the price of the home they buy today won't drop tomorrow.

But it's not just about buying. The rental market has been through the wringer, too. Even though overall inflation has cooled down, the cost of shelter remains high. There's some hope that if borrowing costs ease up, it might also take some pressure off the rental market, as more renters might buy homes and free up rental units.

But don't expect miracles in affordability. Housing affordability hit a 41-year low in 2023, but there's been a slight reversal recently, with home prices dropping in some areas. However, a big factor in whether housing becomes more affordable is the supply. We need a lot more houses to meet the demand, especially with Canada's immigration levels.

The federal government has plans to boost home construction, but even with that, it might not be enough to keep up with the demand and make housing truly affordable.

To sum it up, 2024 is shaping up to be a crucial year for the Canadian housing market. There are a lot of promises and proposals floating around, and it's time to see if they actually pan out. We're all waiting to see if this is the year things start to turn around in the housing world.

hello@gmg.asia

What to Expect in 2024 [U.S. Real Estate]

As we usher in 2024, a world of exciting opportunities awaits in the U.S. real estate market, particularly for foreign nationals and U.S. expats seeking to make strategic investments.

What to Expect in 2024

Zillow.com predicts the prices of homes in the United States will increase by 6.5% from July 2023 to July 2024. This increase is based on rates remaining relatively unchanged. The prediction suggests that the value of homes is likely to increase, mainly due to the lack of inventory and owner-occupied buyers waiting for interest rates to decrease. What will happen to property prices if interest rates decrease? 

The housing market is constantly changing, subtly shifting over time. For those investors with a keen eye, there's an opportunity to discover a unique and profitable niche. The current state of real estate, marked by a standoff between buyers and sellers due to high mortgage rates, creates an environment where savvy investors can make strategic moves. Suzanne Miller from Empire State Properties notes that despite the rising home prices, many potential buyers are holding back due to these higher mortgage rates.

In line with Bank of America's 2023 Homebuyer Insights Report, this shift in the market is already underway. In October, nearly 40% of those looking to purchase homes expressed their determination to proceed with house hunting, showing little regard for waiting until conditions improve. This contrasts sharply with the sentiment observed just six months prior, where only 15% of potential homebuyers demonstrated a similar eagerness to move forward.

Renowned real estate expert Barbara Corcoran anticipates a significant market shift when interest rates drop. "The minute those interest rates come down, all hell's going to break loose, and the prices are going to go through the roof," she said. "Right now, sellers are staying put. But they're not going to stay put if interest rates go down by two points. 

"It's going to be a signal for everybody to come back out and buy like crazy, and the house prices [will likely] go up by 20%," she said. "We could have COVID [market] all over again."

Advantage for International Investors

International investors have a clear advantage. The National Association of Realtors reports a 9.6% decline in annual foreign investment in U.S. existing home sales, totaling $53.3 billion. This decline, along with the lack of owner-occupied buyers sitting on the sidelines, means less competition, making it an excellent time to get into the U.S. real estate landscape.

Rental Opportunities

Understanding the opportunities for profitable investments, overseas investors should consider exploring rental options and the potential returns they offer. As home prices rise and available properties become scarce, there are numerous possibilities for U.S. investment properties with high potential returns.

The latest report from ApartmentLists highlights cities that have experienced the most significant growth in the past 12 months. Leading the list are Indianapolis (+6%), Columbus, OH (+6%), Oklahoma City (+6%), Hartford (+5%), Chicago (+6%), and Cincinnati (+6%). Since the start of the pandemic, Tucson, AZ, has seen a substantial 37% increase in rents, while Tampa, Florida, has also seen significant rent growth, up by 39%.

Wallethub also compiled a comprehensive list of cities with thriving real estate markets and high buyer demand:

Seize the Opportunities with America Mortgages

As we navigate 2024, whether you're a seasoned investor or just entering the world of real estate, now is the time to act. Our team is ready to guide you through your journey, ensuring that you not only invest but thrive in the ever-evolving real estate landscape.

Our 100%-owned subsidiary, America Mortgages, focuses only on providing U.S. mortgage financing for foreign nationals, non-residents, and U.S. expats. 100% of our clients fit that profile, and no one does it better. 

Reach out to us now to schedule a commitment-free consultation with one of our U.S. mortgage loan officers based worldwide; simply use this 24/7 calendar link to book an appointment.

www.americamortgages.com

France Alert! 100% Financing Available for Luxury French Property!

France Residential Mortgages

GMG Presents...

Mortgages for Luxury French Property with... 

100% Purchase Price Financing!

THE ALLURE OF THE FRENCH RIVIERA

Nestled on France's southern coast, near the Italian frontier, the French Riviera showcases some of the most enchanting towns you could envision. With its chic allure, this region has magnetized celebrities for generations. Boasting approximately 300 sunlit days annually, its climate is nothing short of ideal. From designer boutiques, to the array of nearly 40 Michelin-starred restaurants, it's a destination of elegance. It's also a thriving community of English and American expatriates.

TOP DESTINATIONS FOR PROPERTY OWNERS

Surrounded by both the majestic mountains and the serene sea, the Riviera promises a perfect balance. While the coast will be your regular retreat, snow-capped peaks are always within reach for a winter getaway. Explore the top places to reside in the Riviera:

  • Antibes: Originating from the 16th century, Antibes exudes a maze-like ambiance. Renowned for its breathtaking golden glow, which has attracted artists over the centuries, it houses magnificent villas in the wooded Cap d'Antibes. 
  • Cannes: Apart from the high-end boutiques and its iconic film festival, Cannes is a stone's throw from the secluded Lérins Islands. 
  • Nice: As one of the significant French cities, Nice offers a vibrant nightlife, chic boutiques, and diverse museums. 
  • Saint-Jean-Cap-Ferrat: This petite peninsula is the address for some of the Riviera's most luxurious estates and also offers upscale dining options and serene beaches with panoramic views.
  • Saint-Tropez: Famed for its pristine beaches and dynamic clubs, Saint-Tropez is a haven for entertainment seekers but also has developed into a family holiday destination. 

Now to the good stuff....

FINANCING FOR FOREIGN NATIONALS

Problem: Securing financing for Foreign Nationals to purchase property in France has always been difficult - time zone, language, lack of understanding for both lender and borrower, and other issues. Most banks and financing institutions are not focused on Foreign Nationals as the domestic market is strong, and they have enough business to satisfy them.

The GMG Solution: Our GMG European Lender Acquisition team has worked with a few smaller private banks to create a financing solution for our international clientele with a structure that suits their specific needs. 

ELIGIBILITY AND REQUIREMENTS

For Foreign Nationals seeking finance in this exclusive domain, banks have set specific benchmarks to evaluate potential candidates.

1. Geographical Preference

  • Prime Locations: It's imperative for the property in question to be situated in sought-after areas. This encompasses regions such as Paris, leading stations in The French Alps, and The French Riviera.
  • Emerging Desirability: The South West has been gaining traction recently, making it an area of interest for Private Banks.

2. Property Type

  • Prospective properties should fall under categories such as: Luxury Apartments, Modern Residences, Contemporary Villas, Maisons de Maître, Manoirs, or Impeccably Refurbished Chateaux (case-by-case basis).

3. Loan Size

  • Minimum loan amount is €1M, excluding ancillary fees.

4. Our 100% LTV Solution!

  • In this structure, the client will invest a portion of funds equal to 30-50% of the loan amount into an interest-earning product.
  • In return, the bank will finance 100% of the purchase amount of the property (excluding fees)! 
  • Client earns investment income, which may be more than the interest paid on the mortgage = positive carry.

5. Age Bracket

  • Applicants should be no older than 65 years at the submission time, with a preference for those below 60.

6. Financial Overview

  • Generally, the focus is on High Net Worth (HNW) individuals, specifically those boasting a net valuation exceeding €2M. Liquid assets or readily available cash remains a pivotal factor in discussions.

HOW IT WORKS

Example
Purchase price: €1,000,000
Loan amount: €1,000,000 (100% LTV)
Interest rate: 4.50%
Loan duration: 20 years
Loan type: Principal + Interest

Investment amount: €500,000 (50% of loan amount)
Investment return: 4.50% Compounded 

Mechanics
The 100% LTV mortgage
€1,000,000 @ 4.50% for 20 years
= Total mortgage interest PAID = €518,359

The interest-earning investment for 50% of loan amount
€500,000 investment @ 4.50% “Compounded” for 20 years 
= Investment value end of Year 20 = €1,205,000 - €500,000 principal
= Total interest EARNED = €705,000

€705,000 EARNED - €518,359 PAID
= Net POSITIVE cash flow = €186,641

That is to say, the bank will give you a positive carry-trade for using their mortgage, and not only is the mortgage FREE, you MAKE money!

THE PURCHASE PROCESS

Navigating property acquisition in France is smoother with the guidance of a property buyer's agent familiar with the region and the nuances of French property transactions. Once you've found your dream home, the steps are as follows:

  • Proposal Submission: You'll submit a written proposal. This will be forwarded to the property owner for a response. If the proposal gains approval, both parties – the buyer and the seller – will endorse the 'Compromis de Vente.' This preliminary agreement outlines the property specifics and the sale terms. As the transaction progresses, especially during conveyancing, certain terms in this contract might undergo modifications.
  • Reflection Window: Following this, there's a 10-day cooling-off window. During this phase, should you reconsider the purchase, you can withdraw without repercussions. Specifically, the 5-10% earnest money you've placed as a deposit is fully refundable.
  • Financing Initiatives: At this juncture, the financial groundwork commences (details above).
  • Conveyancing Phase: Post cooling-off window, the conveyancing phase kicks off. This process, extending up to three months, involves a series of property evaluations, all supervised by the notaire.
  • Finalization: After a thorough review and addressing any reservations, the concluding payment is made to the notaire. Subsequently, both parties validate the 'Act de Vente,' essentially the property's title deed.

In conclusion, owning a home in the South of France is now achievable for non-residents with our new GMG Luxury France Mortgages! I hope I get an invite to visit you one day! 

Global Mortgage Group offers innovative financing solutions to meet the diverse needs of our global clientele, including Overseas Expats, Foreign Nationals, Family Offices, Investment Funds, High-Net-Worth Clients, and Private Banks. Contact us at hello@gmg.asia to start your Riviera investment journey today!

If you have any questions, please feel free to contact me directly at donald@gmg.asia or my personal mobile +65 9773-0273. 

www.gmg.asia

Global Mortgage Group Successfully Funds $38.5 Million Singapore Asset-Based Bridging Loan for Good Class Bungalow

International Mortgage Lenders

Global Mortgage Group (GMG), a leading international mortgage originator, is proud to announce the successful funding of a $38.5 million asset-based bridging loan for a luxury Good Class Bungalow (GCB) property in Singapore. The loan enabled the owner to complete the acquisition of another company by leveraging on this prime real estate. 

With a strong commitment to empowering Singapore real estate investors and homeowners with bespoke financial solutions, GMG specialises in catering to the unique needs of high-net-worth (HNW) individuals and foreigners seeking to access liquidity without the need for a deep dive into personal and company financials. GMG offers these customised liquidity solutions worldwide, including U.S.A., Australia, U.K., Canada, Thailand, Philippines, Hong Kong, and Dubai. 

Located in one of Singapore's most sought-after neighbourhoods, the GCB offers unrivalled luxury and privacy, making it a prime investment in Singapore's thriving property market. The loan was structured to meet the client's funding needs and exit timeline at a 72% LTV (loan-to-value) with an 18-month interest servicing-only tenor. This closing marks GMG's successful funding in excess of over $350 million in bridging loans in Singapore this year alone. 

"We are thrilled to have facilitated this substantial asset-backed bridge loan for our client. Our team of experienced financial analysts structured a tailored solution that met the client's specific requirements, enabling them to capitalise on this unique investment opportunity to expand their business. From the initial discussion to funding, the process took only 12 days." said Madel Tan, Singapore Head for Global Mortgage Group. "We have seen an upward trend in market demand for bridging loans that offer flexibility and liquidity to our HNW clients."

GMG's expertise in providing efficient asset-based bridge loans for high-value properties allows their clients access to an extensive network of lenders with bespoke programs. Their commitment to excellence extends to simplifying what is often a complex real estate transaction. 

About Global Mortgage Group:

Global Mortgage Group is a leading international mortgage originator that specialises in offering customised financial solutions for high-net-worth individuals and foreign investors. With a track record of successfully funding significant real estate transactions in Singapore and globally, Global Mortgage Group provides flexible and personalised mortgage options to meet the diverse needs of its clients worldwide.

For more information, please visit  www.gmg.asia  or get in touch with Madel Tan, Director and Head of Singapore at, +65 9634 5623 or madel.tan@gmg.asia.