When your work authorisation expires before the loan does

Almost everyone buying on an H-1B, L-1, TN or an EAD has been told some version of the same thing: you need two or three years left on your status before a lender will touch you. Sometimes it comes from a loan officer, sometimes from a friend who bought last year, sometimes from a forum post.

It is worth knowing where that rule comes from, because it is not in the guidelines. It is a lender overlay — an extra condition one company adds on top of what the agencies require. And since overlays differ from lender to lender, being told no by one is genuinely not the same as being ineligible.

What the conventional rulebook says

Fannie Mae's Selling Guide is unusually short on this. Non-US citizens who are lawful permanent or non-permanent residents are purchased and securitised "under the same terms that are available to U.S. citizens."

There is no minimum period remaining on a visa. No list of acceptable visa categories. No requirement that your status outlast some portion of the loan term. What the guide asks instead is that the lender "make a determination of the non–U.S. citizen's status based on the circumstances of the individual case, using documentation it deems appropriate" — and warrant that the borrower is legally present.

That is the whole conventional requirement. Legally present, documented sensibly, then the same terms as anyone else.

This surprises people, and it should. A thirty-year loan to someone whose work authorisation expires in fourteen months sounds like it ought to be a problem. The agencies decided it is not — mortgages are secured by the property, most are repaid or refinanced long before term, and immigration status is a poor predictor of whether somebody pays their mortgage.

What FHA says, which is more specific

FHA is more prescriptive, and the detail matters if you are putting 3.5% down.

A non-permanent resident is eligible where the property is your principal residence, you have a valid Social Security number, you satisfy the same requirements as a US citizen, and you are eligible to work — evidenced by any one of:

• an Employment Authorization Document (Form I-766) showing that work authorisation is current;
• a Form I-94 evidencing H-1B status, plus evidence of employment by the authorised H-1B employer for at least one year;
• evidence of refugee or asylee status; or
• citizenship of the Federated States of Micronesia, the Marshall Islands, or Palau.

Two things in that list are worth slowing down for.

"Current" is the test, not "long." The EAD has to be valid now. There is no requirement that it run for a further one, two or three years.

If you are on an H-1B, you may not need an EAD at all. An I-94 showing H-1B status plus a year of employment with your sponsoring employer satisfies the requirement on its own. A surprising number of people are told to produce a document they were never required to have.

The expiry rule, quoted properly

This is the paragraph that the "two or three years" folklore is a garbled version of:

If the Employment Authorization Document (USCIS Form I-766) or evidence of H-1B status will expire within one year and a prior history of residency status renewals exists, the Mortgagee may assume that continuation will be granted. If there are no prior renewals, the Mortgagee must determine the likelihood of renewal based on information from the employer or the USCIS.

Read that closely, because it is the opposite of what people expect.

Expiry inside a year is not a decline. It is a trigger for a question, and the question has a documented answer: have you renewed before? If you have — an H-1B extension, an EAD replaced once already, a status changed and re-approved — the lender may assume it will be renewed again.

If you have never renewed, the lender has to form a view, and it does that from your employer or from USCIS. This is where an employer letter earns its place: something on company letterhead confirming continued employment and an intention to sponsor the extension is ordinary, routine, and frequently the whole of what is needed.

Where the "no" usually comes from

If the guidelines are this accommodating, why do people keep hearing no?

Three reasons, in roughly descending order of how often I see them.

Overlays. A bank that funds its own loans can add whatever conditions it likes. "Two years remaining" is a common one. It is a credit-policy decision by that institution, not a rule — and it is invisible to you, because the answer you get is just "no."

The file was read, not understood. An underwriter who sees an EAD expiring in nine months and no renewal history has a question to answer. If nobody puts the employer letter in front of them, the easiest answer is the negative one.

The wrong document was requested. The H-1B case above is the clearest example. Asked for an EAD you have no reason to hold, you cannot produce it, and the file stalls on something the rulebook never asked for.

This is the concrete reason a broker is worth something here rather than a slogan about choice. Guidelines differ most precisely on the files that are least standard, and work authorisation is one of the two or three places where the difference between lenders is largest.

What to actually do, by how much time you have

More than eighteen months. Nothing about your status needs managing. Spend the attention on the things that are genuinely time-sensitive: credit history length, how long you have been with your employer, and where your down payment is sitting. If family abroad is helping, start that conversation now — gift funds need seasoning and paperwork, and that is the deadline that actually bites.

Six to eighteen months. Get the employer letter before you need it. Confirming continued employment and intent to extend takes HR a day when nobody is waiting, and a week when everybody is. If you have renewed before, find the old approval notices — prior renewal history is the single most useful thing in your file.

Under six months, renewal already filed. Your receipt notice is evidence. Bring it. Depending on your category, a timely-filed extension may also carry automatic continuation of work authorisation, which is worth establishing early rather than arguing about under contract.

Under six months, nothing filed yet. This is the one case where waiting may genuinely be right — not because you are ineligible, but because the file is materially easier a fortnight after a receipt notice than a fortnight before. Weeks, usually, not years.

The honest caveats

Guidelines change, and lenders read them differently on purpose — that variation is the entire reason a panel is useful. Everything above is what the published rules say as of this writing, not a decision on your file, and it is not immigration advice. Your attorney is the right person for questions about your status; I am only useful on how a lender reads it.

If somebody has already told you no, it is worth finding out which of the three reasons above it was. That answer usually decides whether the next step is a different lender, one letter from your employer, or genuinely waiting a few weeks.

Sources: Fannie Mae Selling Guide B2-2-02 · HUD Mortgagee Letter 2021-12, amending Handbook 4000.1 II.A.1.b.ii(A)(9)