Newcomer from Canada

[Cody McGonigal]

Hello everyone, 

I've been lurking in the shadows for a roughly a month now trying to get my feet wet and learn the basics. I am struggling to find much information on cross border investing and all its legalities. If anyone can shed some light on where to start looking to find a good real estate financial advisor / accountant that specializes cross border investing that can help me lay a solid foundation to get the ball rolling it would be very much appreciated! I'm looking to get my start in the multifamily space with serious intentions of up scaling into small apartments so someone who has experience in this area would be a huge asset.

I just want to say thanks in advance to anyone willing to take the time to help me start out my investing journey and I look forward to meeting you!

[Omar Khan]

@Cody McGonigal Ex-pat Canadian living in Texas here. 

Before deciding how you want to structure yourself (to avoid double taxation), you should first decide what you want to invest in. For instance, being a passive investor in MF is different than being an active investor in SFR.

As a foreigner, you will be getting awful lending terms from American based lenders - higher interest rates, high down payments, 5-10 year balloon payments. As a non-US citizen, you are a higher risk (in terms of collectability of loan) and do not have any US credit history, hence, the terms. 

You can choose to work with the US-subsidiary of 3 of the Big 5 banks. But they will only lend out on single-family residences (the terms are significantly better as they can access your Canadian credit history). 

This might work if you're only looking to buy 1 house. But it might not be the best way forward if you're looking to buy multiple units. 

You will also need to hook up with a Canadian CPA who has experience with cross-border transactions. You want to make sure everything is structured and accounted for properly. The CRA is very strict in enforcing its regulations especially on foreign properties. You will also have to account for withholding taxes by filing the right form (W8-BEN, I think) at the right time. Again, a CPA familiar with cross-border transactions will be able to help you out (this isn't very hard).

PM if you need any help. Have gone through this pain myself :)