This move follows PNC’s acquisition of RBC Bank (USA) -- the U.S. retail banking subsidiary of RBC sold for a reported $3.47 billion last March. As a direct result of the buyout, many Canadian clients with a U.S. mortgage through RBC Bank (USA) had their loans transferred to a PNC bank.
“Since PNC Bank currently holds many foreign national mortgages transferred in the buyout of RBC Bank (USA), it makes sense for the bank to update their system and allow for new foreign national lending to Canadians,” says Kyle Pearce, founder of Canada Buy South. He also anticipates that Canadian clients will be offered PNC’s everyday banking products, including the PNC Virtual Wallet.
Canadian snowbirds and investors have become the hot target of U.S. financial institutions and lenders in recent years, with BMO recently encouraging its clients to use its U.S. branches to source finance for real estate deals.
Still, Sunil Tulsiani, founder of Private Investment Club, says more U.S. based financial institutions may ease their lending restrictions in the face of increasing investor demand.
“There are so many investors who are waiting for the financing to kick in the USA," he says, "and this will happen. It may take some time, but the financial institutions will eventually loosen up their lending criteria.”
No details of PNC’s new finance program have been made available to date, with Pearse debating whether this offering would change the face of the industry.
“It is hard to say whether this will be a game changer for Canadian real estate investors looking to expand their U.S. real estate portfolios," he tells CREW. "If PNC Bank follows in the footsteps of Royal Bank, then it is possible that Canadians may be limited to financing a single US Investment Property.”
*Check out the September issue of Canadian Real Estate Wealth for an in-depth analysis on how Canadians can source finance from U.S lending institutions.
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