Yes, a Canadian can get a mortgage in the US, though you will most likely borrow through a foreign national loan program rather than a standard conventional mortgage. Expect to put down at least 20 percent, hold a year or more of payments in reserve, get an Individual Taxpayer Identification Number from the IRS before closing, and take on U.S. tax filing obligations for as long as you own the property. Rates run higher than what a domestic borrower pays, but the loan itself is achievable with a clean Canadian credit file and documented income.
Which Loan Programs Are Actually Open to You
There are two doors. Conventional loans backed by Fannie Mae or Freddie Mac are the cheaper option, but Fannie Mae’s selling guide requires the lender to warrant that a non-U.S. citizen borrower is legally present in the country.1Fannie Mae. Non-U.S. Citizen Borrower Eligibility Requirements If you live in Canada and hold no U.S. immigration status, you generally will not qualify. Canadians with a valid U.S. visa or a green card may.
The second door, and the one most Canadian buyers walk through, is a foreign national mortgage. These loans sit in the lender’s own portfolio instead of being sold to a government-sponsored enterprise, which gives the lender room to underwrite around your residency and Canadian paperwork. The cost of that flexibility is real: interest rates typically run 0.5 to 2 percentage points higher than a comparable domestic loan, and down payment requirements are steeper.
Down Payment, Reserves, and How “Seasoned” Money Works
Most foreign national programs require a down payment between 20 and 35 percent of the purchase price. On a $400,000 property, that is $80,000 to $140,000 in cash before you get to closing costs.
The money also has to be seasoned. That means it needs to sit in a verifiable account for at least 60 days before you apply, so the lender can confirm it wasn’t recently borrowed. A last-minute transfer from a line of credit will not pass underwriting.
On top of the down payment, foreign national lenders usually want cash reserves left over after closing. Twelve to twenty-four months of full housing payments — principal, interest, property taxes, and insurance — is a common range. Reserves protect the lender against income swings and currency movement between the loan and your paycheck.
Documents and Credit
A valid Canadian passport is the primary ID your lender needs to satisfy federal customer identification rules.2eCFR. 31 CFR Section 1020.220 – Customer Identification Programs for Banks Many lenders will also ask for a Canadian driver’s license as a secondary ID.
For income, plan to hand over:
- Two years of T4 Statements of Remuneration Paid
- Complete Canadian tax returns for the same period
- T1 General returns and business financial statements if you are self-employed
- 60 to 90 days of recent bank statements covering your down payment and reserves
Every dollar figure on the application — salary, savings, debts, monthly obligations — gets converted from Canadian to U.S. dollars, usually at the exchange rate on the date you apply. The lender freezes that conversion so your debt-to-income ratio stays consistent through underwriting.
Your credit file is easier than most Canadians expect. Equifax and TransUnion operate on both sides of the border, so U.S. lenders can pull an international credit report showing your Canadian cards, car loans, and any existing mortgage. A strong Canadian file generally earns better loan terms. A thin file can still work under some foreign national programs, which accept alternative credit documentation like bank reference letters or proof of on-time rent.
Getting an ITIN Before You Close
You do not have a Social Security Number, and federal law requires a taxpayer identification number for every person in a reportable transaction. The IRS issues Individual Taxpayer Identification Numbers to people who are not eligible for an SSN.3Office of the Law Revision Counsel. 26 U.S. Code 6109 – Identifying Numbers Your lender uses it to report mortgage interest on Form 1098, and you will need it on any U.S. tax return you file.
Apply with Form W-7, your passport (or a certified copy), and documents showing why you need the number. For a mortgage, you can attach a letter from the lender under the exception for third-party mortgage interest reporting.4Internal Revenue Service. Instructions for Form W-7 Processing takes about seven weeks most of the year, and nine to eleven weeks between mid-January and the end of April. Start early. If the ITIN is not in hand by closing, closing does not happen.
How the Application and Closing Actually Work
The application itself is the Uniform Residential Loan Application, Form 1003.5Fannie Mae. Uniform Residential Loan Application Form 1003 You list your Canadian address in the address history section and fill in the financial fields in U.S. dollars. Once you submit, the lender orders an appraisal and starts underwriting.
Appraisal and Underwriting
A licensed appraiser inspects the property and produces a report confirming its market value supports the loan amount.6FDIC. Understanding Appraisals and Why They Matter Appraisal fees generally run $500 to $1,200. While that is underway, underwriting works through your credit, income, assets, and the property’s title.
Closing Disclosure and Signing
Federal rules require the lender to deliver a Closing Disclosure at least three business days before closing so you can review the final terms, monthly payment, and fees.7Consumer Financial Protection Bureau. What Should I Do if I Do Not Get a Closing Disclosure Three Days Before My Mortgage Closing? Compare it against the Loan Estimate you received when you first applied, and raise any large changes before you sign.
If you cannot travel for the signing, most states allow remote online notarization, where you appear on video before a licensed notary and sign electronically. A power of attorney is the alternative: you authorize someone physically at the closing to sign for you.
Moving the Money Across the Border
Wiring a down payment from Canada to a U.S. escrow account costs more than the wire fee suggests. Outgoing international wires typically run $35 to $50, and the receiving bank may charge up to $25. The bigger number is the currency conversion spread, commonly 1 to 3 percent above the mid-market rate. On a $100,000 wire, that spread alone can cost $1,000 to $3,000. Wires take one to five business days to arrive, so send funds well before your closing date.
Tax Obligations You’re Taking On
Owning U.S. property creates U.S. tax filing obligations regardless of where you live. Three pieces matter most.
Rental Income
Rent your U.S. property, and by default the IRS taxes the gross rent at a flat 30 percent — no deductions for mortgage interest, property taxes, maintenance, or depreciation.8Internal Revenue Service. Nonresident Aliens – Real Property Located in the U.S. Most Canadian landlords instead make an election under Section 871(d) of the Internal Revenue Code, which treats the rental as connected to a U.S. business and allows deductions against net income taxed at regular graduated rates.9Office of the Law Revision Counsel. 26 U.S. Code 871 – Tax on Nonresident Alien Individuals You make the election by attaching a statement to Form 1040-NR the first year it applies, and it stays in effect until the IRS grants permission to revoke it. File more than 16 months after the original due date and the IRS can deny your deductions entirely, leaving the 30 percent gross tax in place.
FIRPTA When You Sell
When you sell, the buyer is required to withhold 15 percent of the sale price and send it to the IRS under the Foreign Investment in Real Property Tax Act.10Internal Revenue Service. FIRPTA Withholding On a $400,000 sale, that is $60,000 held back at closing. It is a prepayment against your actual capital gains tax, not a separate tax. You file a U.S. return after the sale, calculate what you truly owe, and get a refund for any excess.
Two ways to reduce that upfront hit: if the buyer will use the property as a personal residence and the sale price is $300,000 or less, no FIRPTA withholding is required.11Internal Revenue Service. Exceptions From FIRPTA Withholding You can also apply in advance using Form 8288-B for a withholding certificate that lowers the amount held back when your expected tax is well under 15 percent of the price.12Internal Revenue Service. ITIN Guidance for Foreign Property Buyers Sellers
U.S. Estate Tax Exposure
The piece most Canadian buyers miss. If you die owning U.S. real estate, the property falls under U.S. estate tax, and the threshold for a nonresident alien is $60,000 — not the $13 million-plus a U.S. citizen or resident gets.13Internal Revenue Service. Estate Tax for Nonresidents Not Citizens of the United States Assets above that threshold face graduated rates up to 40 percent.14Office of the Law Revision Counsel. 26 U.S. Code 2101 – Tax Imposed The U.S.–Canada tax treaty softens the result through a proportional unified credit and a special credit for transfers to a surviving spouse, but it does not eliminate the tax. Cross-border advisors often suggest specific ownership structures or life insurance to cover the potential liability. Whatever path you take, price this into the decision before you buy — a conversation with a tax professional who works both sides of the border is one of the highest-value steps in the whole process.