What are your requirements to close a transaction if the purchase of residential real estate is being made by a foreign national who is not a US resident? Two scenarios: with and without a loan. Yes there are lenders willing to lend for NOO with only a foreign passport. Does the buyer need to have a bank account in the US in case the funds for the purchase are coming from abroad through a direct wire transfer?
Escrow typically has no particular requirements for foreign buyers. Keep in mind there are escrow requirements in the case of a foreign seller, including Federal and State tax withholding which may apply.
We are required to run a homeland security search on all parties in escrow (buyers and sellers), sometimes parties come up on a watch list. If a client has a common name, there may be additional requirements to clear them from the watch list.
With the use of a swift code, a buyer can wire funds directly to the Glen Oaks Trust Account, from a foreign banking institution. Please keep in mind some foreign nations have limits on how much money a citizen can move out of the country, within certain time frames. This can cause a delay in closing.
You may also want to make sure the buyer is aware that their funds may take several days to move between their country and the US, depending on banking and customs constraints. They should plan on being able to send funds early, so there is plenty of time for closing.
Any documents requiring notarization in the escrow must be notarized here in the US, or at the Office of an American Consulate in foreign countries. Some Consulates require appointments in advance, and it may take several days or more to be able to get documents notarized overseas. The notarization services at an American Consulate are not “loan document signing services”. They will simply notarize the requested documents, and do not assist the buyer in figuring out where and how to sign loan documents.
Conducting business with individuals in foreign nations can vary in complexity, depending on where your client resides. I recently had a transaction with an Iranian national. That was VERY problematic, as our two countries have no diplomatic ties. This was a seller, and he had to have his signature notarized at a Swiss Embassy in Iran, who offers the service ONLY to benefit American Citizens.
My buyer had to go out and get a US Passport and send a copy to the Swiss Embassy, before the Swiss would notarize the seller. Upon closing it was difficult to get the seller his sale proceeds, due to banking constraints. This transaction was with a foreign seller, not a foreign buyer, but it illustrates that there could also be a problem for someone from Iran (or other countries that lack diplomatic ties with the US) trying to purchase in the United States.
The bottom line is that we often do escrows for foreign buyers, without any trouble, assuming no conflict between US and their County of origin.