What is a Physician Loan Mortgage?
Physician loan mortgage, often called Doctor Loans, can mean many different things in several different scenarios. In some cases, it may mean calculating your debt-to-income* ratio (DTI) a little differently to account for some of the student debt you may have accumulated on the way to achieving your dreams of success in the medical field. In other cases, it may come in the form of an opportunity to save money on closing costs.
Fairway understands that no two situations are identical, and our mortgage advisors can examine your unique situation to see which home loan program best fits your needs. We can help you gauge which mortgage loan options fits your needs, how future income may impact your mortgage situation, and how best to factor student debt into your qualification for a home mortgage loan.
*Debt-to-income(DTI) ratio is monthly debt/expenses divided by gross monthly income.
Physician Loan Mortgage FAQs
How do student loans affect my pre-approval** with a physician loan?
There are multiple types of physician loan mortgages. Some of them allow Fairway to ignore your student loans altogether when calculating your DTI as long as they are deferred for another 12 months from the time of the mortgage loan application. There are other loan programs that don’t allow us to ignore the student loan debt, but that do feature higher qualification guidelines to help you qualify, even with those student loan payments.
When it comes down to it, it is your Fairway mortgage advisor’s job to review all of the different mortgage loan options, along with your unique credit and income situation, to determine what the best home loan program is for you.
How much down payment do I need for a physician loan?
This is one of the most common questions we receive, regardless of loan type. When it comes to medical professionals, especially new residents, typically these medical professional loan programs have flexible guidelines that allow you to get into your new home with less than you think upfront for a down payment. However, these program guidelines change often, so what’s best is to have a conversation with your Fairway mortgage advisor so that we can determine what the best option is for you.
Do medical doctors have to use a physician loan mortgage?
Again, it is your Fairway mortgage advisor’s job to look at all the home loan options on the table, compare and contrast them and tailor fit a home mortgage plan that best fits you, your family and your financial goals. We would much rather keep all your home loan options open and guide you to make the right decision, rather than push you into a loan product just because it matches your job title.
Should I wait until I start my residency before buying a home?
Ultimately the timeline is up to you, and at Fairway, we want to give you as much flexibility as possible on your path to homeownership. Some of our programs allow you to close on a home as many as 90 days before the first day of your residency, as long as you can provide proof of a signed offer. This flexibility can make a huge difference for many medical professionals and their families!
Is a physician loan a Conventional mortgage loan?
Some medical professional loan programs are Conventional loan products, yes. These are specific home loan programs that allow for the consideration of future income and for Fairway to calculate your DTI a little differently in relation to your student loans when you apply.
Others are considered jumbo loans. It’s best to discuss all your options with your Fairway mortgage advisor to choose the home loan program that best fits you and your financial situation and goals.
Can you refinance a physician loan mortgage?
Yes. The rules for refinancing your home loan are the same, regardless of loan type. Typically, you must wait at least six months before refinancing your home loan.
*Pre-approval is based on a preliminary review of credit information provided to Fairway Independent Mortgage Corporation, which has not been reviewed by underwriting. If you have submitted verifying documentation, you have done so voluntarily. Final loan approval is subject to a full underwriting review of support documentation including, but not limited to, applicants’ creditworthiness, assets, income information, and a satisfactory appraisal.