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The Doctor Loan has a Long History in The United States.

The Doctor Loan

The Doctor Loan

The Doctor Loan has a long history in the United States.  First offered to attract new physicians to growing towns in the Wild West, they have evolved to what we have today.  18,000 new doctors graduate from medical school every year. These borrowers can have very specific credit and income profiles that represent a different kind of risk, not reflected in a normal borrower profile.

That is why Mortgage 1 has a very specific program designed for that type of individual.  Physicians of all types can benefit from our “Doctor Loans” Some of the advantages are;

  • Available for new residents, new attending (7-10 years out of residency), or to a doctor at any stage of his career, for a second home.
  • Flexible down payment options.
  • Private mortgage insurance (PMI) is not required on some Doctor Loans.
  • Rather than looking for past income we will consider an employment contract as documentation of future earnings (instead of paystubs)
  • A Doctor Loan can be on the primary or secondary homes.
  • Loan amount can go all the way up to $2 Million.
  • Certain programs allow new Physicians to use gift money for a down payment, for required reserves, or for closing costs.
  • Often doesn’t calculate student loans the same way as standard underwriting.

Other than a “Doctor Loan”, what other options are there for Physicians?

20% Down Conventional Mortgage– Often this is the best choice for borrowers. Conventional loans generally offer the most term options and lowest fees, with the lowest rates.  It does require proof of earnings and a substantial sum of money to put down.

FHA Loan– This loan can have higher fees and rates than a conventional mortgage.  FHA mortgages can have a smaller required down payment, and a monthly mortgage insurance premium. This loan requires the lender to use the credit report amount of the student loan payment, or if none listed, 1% of the outstanding balance unless the borrower can provide documentation that the loan is in deferral.  The interest rate could be slightly lower than a Doctor Loan, but could wind up costing more because of PMI costs.

VA Loan– This loan requires that you qualify for VA benefits. There is no down payment or mortgage insurance requirement.  Rates are similar to FHA rates, but the funding fee is slightly higher.

Doctor Mortgage Loan

Doctor Loan