Short answer: a foreign national cannot borrow on our small-balance commercial program, and of the trust family, only a revocable trust qualifies. Both answers come from the same place — we look through the borrowing entity to the human beings behind it, and every one of them has to be a US citizen or a permanent resident alien who can sign for themselves.
That sounds simple. In practice it is where a surprising number of otherwise clean deals die, usually two weeks in, when the operating agreement finally arrives and shows a holding company as the member, or title shows the property vested in a trust nobody thought to ask about.
Everything below is drawn from our SBC program guidelines, effective 8/3/2026. Where the guidelines are silent, this page says so rather than guessing.
The eligibility test in one sentence
Four separate requirements are stacked inside that sentence.
For-profit. The borrowing entity has to be organized for profit.
Wholly owned by citizens or permanent residents. Not majority-owned. Not 75 percent. The word is wholly, and there is no stated tolerance for a minority owner who does not meet the standard.
Domiciled in the United States, and US-based. Two tests, both listed.
Natural person members. There has to be a human being at the bottom of the structure. This is the requirement that kills layered ownership.
Who counts as a US person here
Two categories are eligible: US citizens and permanent resident aliens. Everyone on the following list is not.
The temporary-status line is the one worth reading twice. It is not limited to a named visa class. It reaches "any other form of non-permanent residency," which is written broadly on purpose. If the status is not permanent, the applicant is not eligible — regardless of how long they have been here, how much they earn, or how much they are putting down.
Diplomatic immunity is a separate exclusion, and it applies to borrowers and guarantors alike. A guaranty you cannot enforce is not a guaranty.
What the guideline does not address
This is where most content on this topic overclaims in one direction or the other, so here is the honest boundary.
The guideline does not define "foreign national." It does not enumerate visa categories or draw a line between one non-immigrant status and another — it excludes non-permanent residency as a class. It does not separately address conditional permanent residents, applicants with a pending adjustment of status, dual citizens, or expired-but-extended residency cards. It says nothing about a minimum length of US residency or US credit history beyond the general credit requirements that apply to every guarantor.
We are not going to invent answers to those. What we can tell you is the documentary standard the file has to satisfy, and that standard is where most of the ambiguity actually gets resolved.
The documents that settle it
Identity and country of residency are proven with a document, not an assertion.
If a guarantor can produce one of those three, the citizenship-and-residency question is answered. If a guarantor cannot, no amount of narrative about intent, tenure, or tax filing history substitutes. That is the test to run at the kitchen table before anyone orders an appraisal.
Note what is not on that list: a work authorization card, a visa stamp, or an ITIN. Their absence is not an accident given the exclusions above.
Foreign money is treated differently from foreign people
This is the one place the program is more accommodating than its reputation suggests. An ineligible borrower is ineligible — but eligible borrowers can bring foreign assets to the closing table.
So a citizen or permanent resident with money sitting in an overseas account is a workable file. The funds have to be converted, landed in a US institution, and verified in dollars before closing — but they count.
Which entity types we lend to
| Structure | Eligible | Notes |
|---|---|---|
| LLC | Yes | Members must be natural persons |
| Limited partnership | Yes | Named in the eligible list |
| General partnership | Yes | Named in the eligible list |
| Corporation | Yes | Named in the eligible list |
| Revocable trust | Yes | The only eligible trust form |
| Irrevocable trust | No | Ineligible, including as a member |
| Community land trust (CLT) | No | Ineligible |
| Life estate | No | Ineligible |
| Guardianship | No | Ineligible |
| 501(c)(3) / non-profit | No | Ineligible |
| Entity whose members are entities | No | Unless a natural person can be established |
| Any structure signing under power of attorney | No | Ineligible as a trust or LLC structure |
| Individual borrower, no entity | See state rules | Prohibited in specific states and property configurations |
Trusts: revocable yes, irrevocable no
The eligible-entity list includes "Trusts – Revocable only." The ineligible list is more emphatic.
The parenthetical is the part that catches sophisticated borrowers. It is not enough that the borrowing entity itself is not an irrevocable trust. If an irrevocable trust holds a membership interest anywhere in the structure — a common estate-planning outcome — the file is ineligible on that basis.
The logic is consistent across every exclusion here. A revocable trust has a living grantor who holds the beneficial interest and can be personally bound by a guaranty. An irrevocable trust, a guardianship, and a life estate each break that chain: the person signing either cannot bind the beneficial owner or cannot be reached if the loan defaults. A community land trust adds a third-party interest in the land itself.
Power of attorney deserves its own line. A trust or LLC where power of attorney is used is listed as ineligible outright. Separately, at closing, powers of attorney are prohibited unless approved by our legal counsel. Do not plan a closing around a POA and assume it will be waved through.
The "warm body" rule
This is the most common structural decline, and the guideline names the problem in plain language.
Note the qualifier. Layering is not automatically fatal — the disqualifier is the inability to establish a natural person. A two-tier structure where the parent LLC's members are three named, documented individuals can be worked through. A structure that terminates in another entity, in an irrevocable trust, or in a chain we cannot follow to a human being, cannot.
The cost of layering is diligence, and diligence is where files stall.
Every entity in the chain gets searched, along with every controlling party. A five-entity structure means five searches plus the individuals, and each one is a place the timeline can break.
Who has to sign
People assume the guaranty follows the signature block on the note. It follows ownership and control instead.
A "controlling holder" or "manager" is any individual or entity with authority to direct the activities of the borrowing entity or act on its behalf — borrowing funds, dissolving the entity, removing members — without needing unanimous or majority member consent. A non-member manager with that authority can be asked to guarantee a loan they hold no equity in.
All parties appearing on the note or loan guaranty assume joint liability for repayment. Personal liability can never be limited solely to the borrower's or guarantor's interest in the business or the secured property. The entity does not shield the humans on this program; it organizes them.
Tri-merged credit reports are required on all individual guarantors, principals, or controlling parties holding 25% or more, directly or indirectly. We may pull a report on individuals below 25% based on our review of the entity structure.
Non-profits and federally illegal businesses
501(c)(3) organizations and non-profits are ineligible. That follows from the for-profit requirement, and it is stated separately in the ineligible list. A church, a charter school operator, or a community organization cannot be the borrower here, no matter how strong the property.
Separately, and more broadly than most people expect:
The "regardless" is doing the work. Carving the income out of the application does not cure the ownership. This is a person-level and entity-level test, not a property-level one.
The state and residency restrictions
These get missed most often, because they are not about who the borrower is — they are about where they are and where they sleep.
Two distinct rules there. The first governs lending to individuals — which the entity requirement already largely resolves, since the program lends to legal entities. The second is a residency rule that applies to entities too: if the borrower or guarantor lives in one of the residential units of the subject property, at the unit counts described, we cannot lend. Owning the building is fine. Living in it, at those sizes, in those states, is not.
Beyond that, we lend in all states and the District of Columbia except where prohibited by licensing and compliance requirements.
What the guarantors themselves have to clear
Passing the entity test gets you to the credit test. The floor:
A minimum FICO of 650 is required for the primary guarantor, and a minimum of 640 for all other guarantors. Where there are multiple borrowers or guarantors, interest rate and leverage are based on the guarantor with the highest middle score, and all other borrowers or guarantors must have a minimum FICO of 640. Personal credit reports must be dated within 120 days of the note date.
Thin files fail on tradelines before they fail on score.
Two tradelines are eligible if the borrower or guarantor has a satisfactory mortgage rating for at least 12 months — opened or closed — within the last 24 months, plus one additional open tradeline. Without a satisfactory mortgage, a minimum of three tradelines is required: at least one active, at least one with a 24-plus month rating, and two rated for 12 months, open or closed. Deferred student loans do not count. Authorized user accounts are not allowed. Non-traditional credit is not allowed. A guarantor cannot have only one credit score or less than 24 months of credit history.
Entity paperwork, and newly formed entities
The legal file is short but unforgiving. Formation documents from the Secretary of State — articles or certificate of incorporation, articles of organization, certificate of formation, or certificate of limited partnership; a filing receipt may be acceptable. The governing document: LLC operating agreement, bylaws with stock certificates, partnership agreement, or trust agreement with certificate of trust. And a certificate of good standing, for which an online print from the Secretary of State website may be acceptable.
If the subject property sits in a state other than the borrowing entity's, you also need a foreign qualification or authorization-to-conduct-business certificate for that state. "Foreign" there means out-of-state, not out-of-country.
New entities are normal here, and several requirements switch off for them: the good standing certificate is not applicable to a newly formed entity, background searches are not required on a legal entity incorporated less than 6 months before the final approval date, and two years of federal business tax returns are not applicable for a newly formed borrowing entity. Forming a clean single-tier LLC to hold a property is not a red flag.
What trips people up
The operating agreement contradicts the application. The application lists two individual members; the operating agreement names a family holding company. The structure, not the summary, controls.
Estate planning done years ago. An irrevocable trust placed in the ownership chain for tax reasons is invisible until the legal file is reviewed, and it is disqualifying even in a minority position.
A minority foreign partner. The standard is wholly owned by citizens or permanent residents. There is no stated small-percentage exception.
Living in the building. An owner occupying a residential unit of a small multi-family or mixed-use property runs into the residency restriction, separately from any occupancy or LTV consideration.
What this page does not do
It does not price your loan, and none of the thresholds above are an approval. Clearing the entity and guarantor tests puts a file in front of an underwriter; it does not decide the outcome.
It does not interpret immigration law. We can tell you which documents satisfy our identity and residency requirement and which statuses are excluded as a class. We cannot tell you what your status is or what it means outside this loan program.
It does not cover property eligibility, occupancy classification, LTV, DSCR, program selection, or documentation tiers. A borrower can pass every test on this page and still be declined on the asset.
It does not fill gaps. Where the guidelines are silent — conditional residency, pending status changes, dual citizenship, specific visa categories — this page says so rather than supplying something plausible. If your situation lives in one of those gaps, the answer comes from a human reading your file.
Rules cited here are current as of our SBC program guidelines effective 8/3/2026 and can change.
Guideline SBC 08/03/2026 · Reviewed August 30, 2026
Published August 31, 2026 · Updated August 31, 2026
How to use this guide
This article is educational guidance, not an offer or commitment to lend. Rules, property facts, credit, leverage, documentation, and full underwriting still control any actual scenario.