Physician Home Loans

Unfortunately, no. You must be a practicing resident, fellow, or attending physician to apply for a Physician Mortgage Loan.

When most individuals purchase a home and make a down payment of less than 20%, lenders require that borrowers purchase Private Mortgage Insurance (PMI) in the instance that the loan is defaulted on. PMI typically costs between 0.5% – 1.00% of your loan amount per year and is based on insurance rates. This can amount to hundreds of dollars extra on a monthly mortgage payment, depending on the size of the loan. With a Physician Loan, though, PMI requirements are waived even if no down payment is made.

When it comes to applying for a loan, an important measurement of qualifications is your debt-to-income (DTI) ratio. Your DTI is all your monthly debt payments divided by your gross monthly income and helps lenders measure your ability to manage the monthly payments and repay the money you borrow. With a conventional mortgage, the DTI is typically required to be 50% or lower. The higher the DTI, the riskier the loan. This DTI ratio can be difficult to achieve, considering the amount of student loans you may have due to medical school. That’s why a Physician Loan is a great choice because it understands that medical school isn’t cheap and is more relaxed when it comes to DTI restrictions. Other debts, like credit card debt, car loans, and other expenses, are still scrutinized, but a higher DTI associated with medical school debt is not necessarily a disqualifier.