What Is a Physician Loan?
What Is a Physician Loan?
A physician loan is a specialized type of mortgage designed specifically for medical professionals, including doctors, dentists, and sometimes veterinarians. This type of loan recognizes the unique financial circumstances of these professionals, particularly those who are recent graduates or early in their careers.
Qualification criteria can vary slightly between lenders, but generally, physician loans are tailored mortgage products designed to assist medical professionals, including doctors (MDs and DOs), dentists, podiatrists, optometrists, veterinarians, and sometimes other healthcare professionals.
What are the key features and benefits?
1. Low or No Down Payment: Physician loans often require little to no down payment, allowing doctors to buy a home without a substantial upfront payment. This is particularly beneficial for new doctors who may not have significant savings yet.
2. No Private Mortgage Insurance (PMI): Many physician loans waive the requirement for private mortgage insurance, even with a lower down payment. PMI is usually required on conventional loans with less than a 20% down payment.
3. Flexible Debt-to-Income Ratio (DTI) Consideration: Lenders offering physician loans are often more lenient with debt-to-income ratios, recognizing that medical professionals might have high student loan debt relative to their income.
4. Career Stage Consideration: These loans typically take into account the earning potential of the borrower’s chosen profession, rather than solely focusing on their current income. This is important because medical professionals often experience significant income growth over time.
Physician mortgages typically focus solely on the required monthly student loan payment, rather than the overall student loan debt amount. Additionally, these mortgages often accept a signed employment contract as sufficient proof of income instead of requiring traditional tax stubs. However, independent contractors usually need to provide two years of tax returns to demonstrate their income stability.
Finding the Right Physician Home loan for you
When it comes to choosing a loan program, the lowest rate isn't always the best choice. Hidden fees and unexpected costs down the road can make that seemingly low rate a costly mistake. That's why we looked at five key criteria - price, experience, teamwork, availability, and service - to ensure we found the best program for your needs.
We spoke with six mortgage brokers who cover a range of options, including large national banks, regional banks, local credit unions, and independent brokers. Through this process, we discovered that not all lenders offer physician loan programs, and even those that do can vary greatly in their terms and conditions.
Experience was also a top priority for us. We wanted a broker who had a proven track record of success and could help guide us through the process with ease. We ultimately chose a broker who specializes in physician loans and has decades of experience in the field, which gave us peace of mind knowing we were in good hands.
Teamwork, availability, and service were also important factors for us. We wanted a broker with a strong team to ensure that our documents were organized, and our underwriter's job was as easy as possible. We also wanted a broker who was available whenever we needed them, and who provided us with top-notch service from start to finish.
If you're a physician in need of a loan program, don't settle. Let us share our experience with you and help you navigate the complex world of physician loans. We can help you find the program that's right for you and achieve your dreams of home ownership.
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Fortress Physicians by the Numbers
🏡 42 Physician Households as Clients
💰 $680,000 Avg Household Income
👩 Average Age 44
💸 $3.25 Million Net Worth
📈 29% Average Savings Rate
Securities and Investment Advisory Services offered through Fortress Private Ledger, LLC. Member FINRA/SIPC
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Talk soon,
Chris