The number of Federal Housing Administration (FHA) mortgages approved for non-permanent residents, including H-1B visa holders, has plunged to almost zero following a new federal housing policy tied to the Trump administration’s immigration measures.
In a March 26 announcement, the U.S. Department of Housing and Urban Development (HUD) declared that non-permanent residents would no longer be eligible for FHA-insured loans starting May 25. The agency said the move aligns with President Donald Trump’s directive to “safeguard economic opportunities for U.S. citizens and lawful permanent residents” and to ensure that government-backed programs like FHA loans are reserved for green-card holders.
The effect was immediate.
According to a recent report from John Burns Research & Consulting (JBREC), the share of FHA loans issued to non-permanent residents dropped sharply—from 6% in April to less than 1% by June—and virtually disappeared by July and August.
“New FHA mortgages to non-permanent residents have fallen to nearly zero since the rule change in May,” said Alex Thomas of JBREC. He noted that non-permanent residents accounted for roughly 4% of all FHA loans in 2024, with states such as Florida recording the highest numbers.
With FHA loans now largely out of reach, many H-1B visa holders and other temporary residents are turning to conventional mortgage options. However, these loans typically require higher credit scores, stable U.S. income, and longer employment histories—criteria that are difficult for many non-permanent residents to meet amid rising housing prices.
Industry experts warn that the change could slow first-time homebuying activity and add pressure to already fragile housing markets. “The restriction on FHA lending to H-1B visa holders is tightening the entry-level housing market at a time when affordability is already stretched,” said Eric Finnigan of JBREC.
Economists also note that this shift could further weaken demand in metro areas with large immigrant workforces, particularly in technology and healthcare sectors where H-1B holders are prominent homebuyers.
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