DACA Mortgages for Dreamers

Every year, there are millions of dreamers who are trying to purchase their dream home. Unfortunately, due to many of the lending guidelines, dreamers often to not qualify. In this article, find out how dreamers can also own a piece of the American dream by purchasing their own home.

For those who are protected under the DACA program, there are lenders who offer dreamers the opportunity to get a mortgage despite not having citizenship. The qualifications are similar to that of a conventional loan with the added requirement of providing either a social security number or an ITIN card.

What is DACA?

The Deferred Action for Childhood Arrivals (DACA) is a U.S. immigration program that offers administrative relief from deportation to eligible undocumented immigrants who came to the United States when they were children. The DACA program protects undocumented immigrant youth from deportation and provides them with work permits. This program has a validity of two years and is subject to renewal.

Who are Dreamers?

The young, undocumented immigrants who are recipients of DACA are referred to as “Dreamers”. They have grown up as Americans, identify themselves as Americans, and most of them have no memory of the country where they were originally from. The current immigration law doesn’t allow most of these young people to gain legal residency even though they have lived in the United States for most of their lives.

With the DACA program, certain undocumented immigrants who came to the U.S. as children can request consideration for deferred action, as long as they meet several qualification guidelines. DACA allows non-U.S. citizens who qualify to remain in the country, which can be renewed every two years. DACA recipients can have work permits, are eligible for other benefits, and are protected from deportation.

DACA Mortgages

It is possible for immigrants who are under the DACA program to get a loan for a home purchase, however, the available mortgage options are limited. If you have a DACA status, it makes you ineligible for certain types of financing. However, you may be eligible for other loan options based on your legal status, credit score, employment history, income, and other qualifying factors.

Available Mortgage For Borrowers Who Have a DACA Status

In general, the DACA program does not give you a lawful, non-permanent resident status. This makes you ineligible for certain home mortgage options, such as FHA loans. Non-U.S. citizens without lawful residency do not pass the eligibility requirements for FHA-insured loans, including those who have DACA status.

The DACA mortgage currently available for Dreamers is a conventional loan supported by Fannie Mae. According to Fannie Mae, a borrower is considered “legally present” in the U.S. if that borrower has a Social Security Number or Individual Taxpayer Identification Number. If you are a Dreamer, you should have current, verified status, and should present a valid employment authorization document with C33 status, or other documentation that shows your immigration status is current, such as a Green Card or working permit.

You need to meet the same qualification requirements of a conventional loan, such as the following:

The loan should be used to buy or refinance a 1- to 4-unit home.
The property must be used as your primary residence and not an investment property.
A down payment of at least 3% is required for a single-family home. Some lenders may require a higher down payment, depending on your credit score.
You should have a credit score of 620 or higher. Some lenders may consider a lower credit score.
You should have a verifiable employment history for the past 2 years.
You should be able to show proof that you have a stable, continuous income.
You should be able to show proof that you have enough money to cover for the down payment and closing costs.

Documentation Requirements for a DACA Mortgage

The amount of paperwork and documentation requirements for a DACA mortgage is basically the same as that of a regular conventional loan. Being a DACA recipient doesn’t mean you have to fill out additional documents because of your residential status.

While the requirements for a DACA mortgage may vary from one lender to another, most lenders will typically require the following documents to verify your residency and employment status:

Your current Employment Authorization Document or EAD card issued by the U.S. Citizenship and Immigration Services (USCIS) and should have a C33 category.
Your previous EAD cards that may have expired. This will show lenders that the USCIS has been renewing your residency status.
Your Social Security Number or Individual Taxpayer Identification Number.

Most lenders will want to see a 2-year employment history to get you qualified for a mortgage. However, self-employed DACA residents may still qualify for a home loan as long as they meet the other requirements required by the lender.

You also need to show proof that you have enough income to pay for the monthly mortgage amortizations and money for the down payment and other fees associated with the loan. Lenders may want to check your income documents such as pay stubs, W-2 statements, federal income tax returns, and other documents that establish your income. You may also bring a copy of your latest bank account statements for the past two months to confirm that you have enough money to cover the out-of-pocket costs associated with buying a home.

How to Get a DACA Mortgage

Conventional DACA mortgages provide opportunities for Dreamers to own a home in the United States. It’s important to meet the necessary requirements set by the lenders and continue to renew your DACA status to qualify.

When you are ready to buy a home and want to have your home purchase financed by a DACA mortgage, the first step is to find a lender that offers DACA home loans. It’s important to ask the lender if they will approve borrowers with DACA status because not all banks will accept applications from DACA recipients. This will help you avoid potential problems later on.

When you find a lender that offers DACA mortgages, the next step is to get yourself pre-qualified. To pre-qualify, the lender will use factors like your credit score, income, and your other current obligations. This will give you an idea of your available options and how much home you can afford to buy.

After you get a pre-qualification, you can start processing your loan application. It’s important to prepare money for your down payment and closing costs. In some cases, you may be allowed to use gift funds to cover all or part of your down payment and closing costs. The people who are eligible to provide gift funds are relatives, dependents, children, and spouses or partners. The person providing the gift fund may need to work with you and your lender to follow certain requirements.

Basic DACA Mortgage Requirements

Residency	Must reside in the United States
Documentation	Either a SS# or ITIN#
Credit Score	620 minimum
Down Payment	Minimum of 10%
Employment	2 year work history
Income	Steady documented income for 2 years
Property Type	1-4 units
Property Use	Primary residence only

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Related Questions

Is a DACA mortgage different than an ITIN loan?
ITIN loans are designed specifically for non citizens who are living and working in the united states and have an ITIN card. There are ITIN lenders who offer special programs for these individuals. They are different than DACA mortgages because with DACA you are not a citizen but you still may also have a social security number.

Can a DACA recipient get an FHA loan?
It is possible for someone with DACA status to get an FHA loan if they can meet the specific requirements and if the lender will accept the DACA status.

ITIN Mortgages for individuals with an ITIN card

Foreign National Mortgages for people who are citizens of another country but would like to purchase real estate in the United States. Read [Foreign National Mortgages]

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