Purchasing a House in the United States

[Shadow Rider]

Does anyone know if its possible for a Canadian to purchase a house in the United States, and can recommend to me a website on the rules and regulations around this?

[Thalo]

I'm pretty sure you can if you don't need a mortgage. A mortgage at a Canadian bank has to be for a house in Canada though and an American bank won't give you a mortgage if you're a non-resident.

[CheapScotsman]

Yes, you can own property in the US if you are non-resident (friends have cabins at Point Roberts) ... however, in addition to what Thalo indicates.

don't forget to check out the IRS website on non-resident taxes and own/disposing of real property. When I was in the US, there was a 30% withholding tax on the net sale (not net profit) value of property when sold by a non-resident. I assumed that I could file I tax return to get it back but didn't check it out as I was a resident at the time (therefore not subject to the withholding tax).

don't forget to check out the Revenue Canada website on foreign property ownership and taxes cause the CDN government will want their share.

[ai_c]

ctv in vancouver had a topic on this, not a detailed one but they mentioned some important points. http://www.ctv9.ca/displayresults.jsp?id=/olsen/stories/2007/07/olsen-20070710.htm

[grant]

There is nothing stopping you from showing up one day and buying a property in the USA.

the INS is concerned with how much time you spend in the USA, and whether you are working there or not.

Financing will be a bit more difficult because US banks are more skeptical of foreigners credentials, but there's plenty of options so a mortgage broker can help you out there.

[michelb]

I'm pretty sure you can if you don't need a mortgage. A mortgage at a Canadian bank has to be for a house in Canada though and an American bank won't give you a mortgage if you're a non-resident.

This is partially incorrect; a Canadian can buy property, you can't get a mortgage from a Canadian Bank but you can get a mortgage from a US bank. You do not need to be a US resident to get a mortgage and you do not even need a Social Security Number (although not having them makes it quite a bit harder and you'll probably need 30% down).

You likely also don't qualify for some of the property tax breaks (e.g. homestead exemptions) or Federal assistance (e.g. FEMA in case of a hurricane).

[monty613]

I'm pretty sure you can if you don't need a mortgage. A mortgage at a Canadian bank has to be for a house in Canada though and an American bank won't give you a mortgage if you're a non-resident.

someone from TD Private Banking told me they may be doing US mortgages soon (if not already)

[Thalo]

Don't see how it's legally possible, unless TD does something through its US subsidiaries for Canadian customers.

Think about it, if TD (in Canada) lends you (a Canadian) money with a lien on a house in the US, how would TD collect if you default? TD doesn't have the right to exercise power of sale in another country let alone foreclosure. But... I guess they could have the mortgage with TD Banknorth, who would have this power, but it's harder now for non-residents to do any kind of banking with US banks (since 9-11 at least).

[15-20_God]

Don't see how it's legally possible, unless TD does something through its US subsidiaries for Canadian customers.

I'm assuming it would be facilitated through their TD Banknorth division, much like how RBC has Centura and BMO has Harris Bank. Probably a simple referral to a banker based in a US branch.

[Prospero]

TD's private banking is handled through Waterhouse, not Canada Trust. And Banknorth's relationship to TD seems to be far less integrated than Centura is with its parent company. In my personal experience nothing seems to be simple and straight forward when going between Canada Trust and Banknorth. Hopefully in the future the two subsidiaries will be more integrated (like with RBC Centura), but certainly its not happening yet.

I know a couple of people who have used their HELOC (from a Canadian bank) on their primary residence (in Canada) to purchase a vacation property in the US and in the Caribbean.

[Shadow Rider]

This is partially incorrect; a Canadian can buy property, you can't get a mortgage from a Canadian Bank but you can get a mortgage from a US bank. You do not need to be a US resident to get a mortgage and you do not even need a Social Security Number (although not having them makes it quite a bit harder and you'll probably need 30% down).

You likely also don't qualify for some of the property tax breaks (e.g. homestead exemptions) or Federal assistance (e.g. FEMA in case of a hurricane).


Ah thanks Michelb, that was a really clear answer, thanks.