What Is an ITIN?

Short answer

An ITIN (Individual Taxpayer Identification Number) is a nine-digit number the IRS issues to people who must file U.S. taxes but are not eligible for a Social Security number. An ITIN mortgage is a non-QM loan that uses the ITIN in place of an SSN, verifies income with tax returns, W-2s, 1099s or bank statements, and builds credit from a tradeline history or alternative references. In Miami-Dade, ITIN lending is a well-established path to homeownership.

Definition

The ITIN is a tax processing number, not a work or immigration document. For mortgage purposes it allows a lender to pull credit, verify filed tax returns and document the borrower's identity when no SSN exists.

Worked example

A couple in Hialeah with ITINs has filed taxes for four years. Combined income on their returns: $96,000, or $8,000 a month. They want a $380,000 townhouse. Suppose the ITIN lender requires 15% down ($57,000), so the loan is $323,000, and allows a DTI of 45%: maximum total debt $8,000 x 0.45 = $3,600. Their car payment is $450, leaving $3,150 for the housing payment. If the estimated PITI plus HOA is $3,050, they qualify with $100 of room. If the lender had required 20% down instead, the loan would be $304,000 and the payment lower, making qualification easier but cash to close $19,000 higher.

What ITIN lenders look for

• A valid, unexpired ITIN letter from the IRS and government photo ID (passport or consular ID).
• Two years of filed tax returns, plus W-2s, 1099s or 12 to 24 months of bank statements.
• Credit: a tradeline history under the ITIN, or alternative credit such as rent, utilities and insurance payments.
• Down payment from your own funds or a documented gift, with reserves.
• Two years of work history in the same line of work.

ITIN loans vs foreign national loans

ITIN loans are for people living and working in the U.S. who file taxes here. Foreign national loans are for non-residents who live abroad and buy a second home or investment in Miami, qualified on foreign income or assets. The documents, down payments and pricing differ, so tell your loan officer which situation fits.

In South Florida

Miami-Dade has one of the largest ITIN-filing populations in the country, and local lenders have offered ITIN mortgages for years, typically for primary residences and sometimes for investment properties. Expect a larger down payment than FHA, a higher rate than conforming, and a full review of two years of tax returns; cash income that was never reported cannot be counted, so filing consistently is the best preparation. Florida doc stamps, intangible tax and homestead exemption apply the same as for any other buyer. See ITIN loans.