I recently returned to the United States after working abroad for several years. Do I have to wait before I can apply for a mortgage?

By Michael Jensen, Mortgage and Finance Guru

Edited by Harry Jensen, Trusted Mortgage Expert with 45+ Years of Experience

Updated October 20, 2020

As long as you reported your foreign income on your federal tax returns, you can verify your current and past employment, your income remains relatively steady and you do not have an extended break in your employment when you move back to the United States, you should not have an issue qualifying for a mortgage.

If you did not report the income you earned while working internationally on your tax returns, or file U.S. tax returns for that time period, then you may need to wait before you can get approved for a mortgage because your verifiable income history is limited. 

Please note that these employment history requirements apply to all mortgage applicants and not just borrowers who worked abroad for several years.

Use ourMORTGAGE QUALIFICATION CALCULATORto determine the loan you can afford based on your current income

If you can verify your income according to your tax returns, regardless of if you are employed in the U.S. or internationally, lenders tend to be more focused on any significant fluctuations in your income, employment gaps and changes in your type of employment. For example, if you go from being a salaried or hourly employee to earning the majority of your income from bonuses or commissions, that can create an issue because lenders usually want to see a two year track record for that type of income.

Additionally, if you change from being a W-2 employee (or whatever the foreign equivalent is) to being self-employed or a contract worker when you move back to the states, that can also create a challenge when you apply for a mortgage. Another potential obstacle is if your income declines significantly, so it is important to demonstrate to lenders that your income is relatively steady when you relocate back to the U.S..

Ideally, you continue working for the same company when you return to the U.S. but this is not a requirement. If you do change companies, however, and your new job has a trial or probationary period then lenders typically require that you wait to apply until the trial period is over before you apply for the loan.

If none of these scenarios apply to you and you are going to continue working in a similar job with the same type of compensation and employment classification, then you should be able to qualify for a mortgage without waiting to apply. Again, this holds true assuming you can provide the lender U.S. tax returns that document your international income while you worked abroad.

You may also be required to provide additional documents such as banks statements and pay stubs to verify your prior foreign income but this should not create an issue, especially if you provide the necessary tax documents.

We recommend that you contact multiple lenders in the table below to confirm their qualification requirements for applicants with foreign income.  Shopping lenders also enables you to find the best mortgage terms.

Sources

"B3-3.1-09, Foreign Income."  Selling Guide: Fannie Mae Single Family.  Fannie Mae, October 2 2019.  Web.