Buy a Home
For those in the medical field, the path to owning a home should be as rewarding as their professional career. As a medical professional preparing to buy a home, you’ll discover a specialized financing option known as a Doctor Loan (or Physician Mortgage). This type of mortgage loan is designed specifically to reward the hard work and often unique financial situations which healthcare providers encounter, particularly at the beginning of their life’s work.
Medical practitioners who meet the established licensing requirements can attain flexible terms and conditions that make owning a home more affordable even as they manage the demands of their vocational development.
You have several loan options available to buy a home, but the more prevalent loans can often penalize doctors due to high student debt and delayed entry into the workforce. For most buyers, a substantial down payment and a low debt-to-income ratio (DTI) are mandatory. Doctor Loans recognize a medical doctor’s income potential, even if you are just starting your residency or have significant student loans.
Doctor Loan programs allow for lower down payments—even NO down payment in some cases—and the exclusion of medical school debt from your DTI calculations under certain conditions. They allow for loans as high as the $1,000,000 to $2,000,000 range, depending on the given circumstances, and they typically avoid costly mortgage insurance (PMI). (A Compass Mortgage loan officer can give you the particulars for your specific situation.)
Doctor Loans are available to physicians (MDs, DOs, DPMs), dentists (with DDS or DMD licenses), veterinarians (DVMs) and, with certain medical professional loan programs, optometrists (ODs), pharmacists (PharmDs), chiropractors (DCs), certified nurse anesthetists (CRNAs) and medical residents, fellows or interns.
Here is a quick comparison of a Doctor Loan with two other popular options:
| Feature | Doctor Loan | FHA Loan | Conventional Loan |
|---|---|---|---|
| Down Payment | Range: 0-10% | Minimum: 3.5% | Range: 3-20% |
| PMI | Not required | Mandatory |
Required (unless down payment is 20% or more) |
| Credit Score | 680-720 | Minimum: 580 | Minimum: 620 |
| DTI | Flexible | Flexible | At or below 50% |
| Distinctions | For medical doctors only; future income (based on employment contract) considered in approval process | Ideal option for first-time buyers, for borrowers with minimal credit history or lower credit scores | Offered by private lenders; competitive interest rates for borrowers with strong credit; available as FRM or ARM |
If you’d like to discover your potential to qualify, connect with us at Compass Mortgage. To help acquaint you with the process and get started, we’ve outlined below the steps and documentation you will need as you move forward.
As you provide us with information about your potential purchase, we will:
We stand ready to help you with every step and are always available to answer any questions and help solve any problems related to your financing.
These are some of the typical prerequisites to qualify for a physician mortgage loan. If you have any questions, we’re here for you!
Without a doubt, you have questions about obtaining a doctor loan to buy a home, and that is perfectly understandable! Below, we’ve included some of the more common questions and their answers, but please feel free to ask us more.
Depending on the specific loan, physicians with credentials as an MD, DO or DPM, dentists (DDS, DMD) and veterinarians (DVM) all meet the professional standards. With certain programs, optometrists (ODs), registered pharmacists (PharmDs), chiropractors (DCs), certified nurse anesthetists (CRNAs) and medical residents, fellows or interns also qualify.
Yes! If you have a signed contract for employment, many doctor loan programs allow you to close on your new home up to 90 days before your official start date.
Unlike conventional loans, many doctor loan programs allow student debt to be excluded from your DTI calculation, providing certain conditions are met.
As is the case with conventional mortgage loans, you will account for origination fees, appraisals and title insurance. However, you will save significantly by avoiding the up-front and/or monthly costs of mortgage insurance (PMI).
Lenders view medical professionals as “low risk” due to high career stability. This allows you to avoid the monthly PMI premium even if you put 0% down, potentially saving you hundreds of dollars per year.
You’re a medical professional with med school debt, but you need to buy a home. Contact Compass Mortgage to discover how a Doctor Loan can make it happen.