"Doctor Loan/Physician Loan Programs"

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Best of luck to you all! These sound like great loan programs.
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Duchenne's said:
So are the doctor's loans location-dependent? In other words, will B of A only give you 100% financing if you live in a certain area?
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I talked to one of the BofA contacts. Apparently the 100% financing is only offered in areas not considered a "declining market". In these areas, you have to come up with 5% down. However, these loans are still without mortgage insurance, and it sounds like the rates are pretty competitive. I apologize if I'm just repeating stuff, but I didn't think I saw it anywhere else in the thread.

Now I have to decide between a 30 yr fixed or 7/1 ARM. Everyone's been telling me to go conservative with a 30yr fixed, especially since I'm doing residency in somewhere I plan to live for a long time, and will keep this house as a rental.

I have been doing all my mortgage research with a 30 yr fixed in mind, so now I'll have to read up on ARM stuff.

With the fixed mortgage, it's just nice to know what your payments will be for the life of the loan, period. Does the 7/1 ARM make sense if I plan to keep the home for more than 7 years?
 
Duchenne's said:
Does the 7/1 ARM make sense if I plan to keep the home for more than 7 years?
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NO. The only time you should ever consider a 7/1 ARM is if you know FOR SURE you will be in the house less than 7 years. Besides, right now the interest rates on ARM loans are higher than the 30yr fixed. There is no reason whatsoever to do an ARM loan right now.
 
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mike1618 said:
You are correct. FHA does require proof of income, meaning you would have to have already started your residency. Based on what everyone is talking about, the physician loan seems like a great program. However, I am still reluctant to jump on the bandwagon because I have not had any direct correspondence with anyone who has actually closed on one recently. More and more loan programs are being discontinued due to lack of investor confidence and demand. I have a hard time believing that these loans are being offered at 100% LTV, with no PMI, while not including deferred student loans in the debt ratios.

I would love to hear from someone who has obtained one of these loans in the last month or so.
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I know of a couple people who closed within the last month or two using a 100% doctor's loan, granted both were ARMs but the rates were good (one under 6% the other like 6.2 or something). I promise these loans do exist. I haven't found a house yet (but hope to within the next week or so) but have been in close contact with the guy at my bank. I met with him again just last week to clarify some things and the 100% with no PMI (and student loans not factored in) "doctor's loan" was still very much available and the rate was still 6.19% (for a 5 year ARM, it would be 6.7 or something for a 10 yr. ARM). Several other programs (one was to get a 30 yr. fixed on a 100% LTV with no PMI which is what we wanted to do) which were available back in January when I first met with him no longer are, but the doctor's loan still is. I suppose it could change any day, but he didn't indicate that there was any possibility of it being discontinued.
 
Does anybody know which bank in Wisconsin do physician mortgage loans?

Thanks.

Andrea
 
Hi Andrea-

I will be starting at MCW in June and are in the same boat as you. Bank of America has no branches in Wisconsin. However, there are several national and local banks that will do business with residents. By "Physician mortgage loan" I assume you want the standard 100% financing (no money down) with no PMI. Off the top of my head I would try Wells Fargo, M & I Bank, Johnson Bank, and the University of Wisconsin Credit Union. Any of those may do business with you. Alternatively, you can contact any of the 100s of mortgage brokers in Wisconsin, any of them are willing and ready to work with you to get you the mortgage that you need. In an effort to not sound "supportive" of any one broker in particular, you can PM me if you want a recommendation or two.

Trust me, everyone wants your money when you're a physician, it's not that hard to find the mortgage that you need. Even in Wisconsin.

And if all else fails, just ask one of the cows, ha!
 
I was having a few problems with finding a loan company that would do the doctor loan, but then I stumbled onto tower mortgage, who were helpful.
 
Hi,does anyone know of a lender who is familiar with the 100%LTV, no pmi physician loans? I have seen the posts about the BofA physician loans, but could someone provide a contact in san antonio?
are the terms for this type of loan only 30yr fix, 5/1 ARM and 7/1 ARM? are there interest only physician loans with the aforementioned terms as well?

thanx
 
Seriously, keep shopping around. I got my 5/1 ARM 100% with a 5% rate, and someone else got 4.875%. Different Bank of America and RBC Centura people will compete for your money. They won't do anything that won't make them money, so don't feel bad.
I didn't want a 30 year because I'm not going to live there for 30 years. 5/1 ARM for a 3 year residency, let it rent if I need to, refi before the amortization.
 
If you're looking for someone who's based in San Antonio, you might want to look up a "BOA mortgage center San Antonio" or something like that.

But, a lot of people go with lenders that are not in the city they're moving to. Just a personal preference I guess. Good luck!
 
I am purchasing a house in Phoenix and got a 10% down 5yr ARM, 6% for a 1.2mil house. Our first broker told me " you have to have 25% cash down for anything non-conforming (over 440K). After making alot of calls through contacts, however, we got this deal. In most cases, though, I think you will need 25% down for anything over 500K (which is anything in Phoenix)
 
Most lenders doing anything like physician loans will be the major ones. Even so, many of the major lenders aren't offering anything like this for the moment due to the mortgage crisis.
 
compass bank has a good deal for new residents too - you can contact a dude named drew daniels at Drew.Daniels (at) compassbank (dot) com or 5one2-4one9-3four3five. last week i was quoted 5.625% with 0 down, $1800 in closing costs...
 
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Hi everyone,
I am just about to start residency and looking to buy a place(assuming I can afford it). I have been doing a lot of research on the Doctor's Mortgages offered by BofA and Suntrust, although I have not spoken to a representative just yet.

My one question to those of you who have done this type of mortgage:

With 0 down and no PMI, how are these mortgages supposed to keep your monthly payments manageable/reasonable?

I am assuming that a lot of it is based on how much you are asking for, but it still seems like the monthly payment would be pretty high.

Can anyone shed some light on this, or perhaps provide an example?

Thanks!
 
I think your question is difficult to understand. You, personally, have to decide what is affordable for you. The benefit of the doctor loan, as I see it, is that you don't need PMI or a down payment, which can be difficult if you recently graduated. Cost are kept down since you don't have PMI. You can use this "extra" money to spend more on a house, or you can save it. They will offer you a certain loan amount based on your income or credit score, and in all probability you will not be able to afford what they offer you.

This is how we got into this mortgage crisis. Banks offered people more money then they could afford, and the recipients of the loans thought that since the banks would lend them the money, they could afford it--the banks know best. Obviously this is BS.

Figure out what you can afford and don't buy more than that. Use your own budget and lifestyle to make this determination. Don't let the bank entice you to borrow more than that.
 
I will second what Mutterkuchen said. Lending institutions will often extend larger loans and lines of credit to physicians than what they would qualify for based solely upon their balance sheet.

I would think long and hard before buying a residence during residency. In all likelihood you will not develop much equity in the home over the course of the residency (unless you are going to do neurosurgery, traditional plastics, OB-GYN subspecialty, or some other insanely long residency), and you are putting yourself on the hook for potential costly repairs.

Best wishes. I personally believe that everyone should speak with a financial planner who truly has your interest at heart prior to medical school graduation and again toward the end of their residency. I have watched way too many of my friends and colleagues do the most ill advised financial moves...
 
I think it's also worth mentioning that 0% down loans are getting harder to come by, so depending on your financial situation you might be better off getting a loan through FHA or maybe even a traditional non-FHA fixed mortgage. The benefit of a doctor's loan is that they don't normally count your student loan debt against you when calculating your loan amount or interest rates, in addition to no PMI. However, if you don't have much or any student loans (lucky you!) and you have enough for a 20% down payment, you'll probably get a better deal shopping around the banks the old fashioned way.

The financial forums over at myfico.com are great, if I can throw in a plug.

-X
 
Does anyone have an idea of some loan programs that offer physician loans (those with 0 down, no PMI). I know of Bank of America. What are the other ones that are out there? Any that are local to Winston-Salem NC? Which one do most residents use? From talking with my friends Bank of America seems popular choice. I have also seen Wells Fargo in the forums. Thanks for any help.
 
First of all, there have been several recent threads on this topic, just look down the page - you may get more info there that will be helpful for all things home buying related, not just the mortgage. You're right that BofA is by far the most popular b/c they consistently have the best rates for these types of loans (ie. 100% financed with no PMI). However if you're like me and you have no BofA branch in your state (there's only a few that don't) then you'll have to look elsewhere. There is a local bank here that does them for us, but it's only in KY. I know SunTrust does them and will do them in states even if there's no SunTrust branch. I believe Regions Bank is another that does them. Not sure about Wells Fargo. But if you can get BofA that's probably the way to go - I heard of someone recently closing with them at 5.75% on a doctor's loan. We are closing in two weeks and got a rate of 5.99%, still good, but not as good as BofA.

Hope that helps. Good luck.
 
Oh, and you don't have to have a BofA in your city just somewhere in the state I believe to get their doctor's loan.
 
I went with Tower Mortgage/Physicians Loans. I have been very pleased with them in terms of great rates and speedy service. I am sitting back ready to close over 3 weeks from my closing date:thumbup:
 
randomedstudent said:
Oh, and you don't have to have a BofA in your city just somewhere in the state I believe to get their doctor's loan.
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This may be true I don't really know. I'm in Cincinnati, no BoA around here but maybe somewhere else in the state. My lender lady is in Durham, NC and we haven't had any problem. Declining markets are everywhere thought so we could only get 95% financed but that was ok. Ended up with 5.0% rate, i'm pleased.
 
Yes, as long as there is a BofA in your state, you can do the Doctor Loan. There are a few different lenders out there doing these loans, you just have to give them all a ring and go with the one you like best. Shop around!
 
hi guys,

ok, so we're all talking about the bofa physician loan, but WHERE can i find this loan. I am buying in chicago and I'm in LA. The loan i thought i had (with another lender) fell through bc they started to count my student loan debt. I already have an offer accepted and my closing date is June 20. I need a loan fast!
 
I really give kudos to Physicians Loans (found on the internet) for their performance with my mortgage

I am a surgery resident tranferring programs with my kids from the NE to the midwest. I had no tolerance for mistakes and insisted on them having me clear to close 3 weeks prior to my closing. Now I am just packing, haven't had to do anything else for my mortgage and am ready to close at the end of this month. If you tell them your situation ( I explained mine) they will get it done.
 
THP said:
NO. The only time you should ever consider a 7/1 ARM is if you know FOR SURE you will be in the house less than 7 years. Besides, right now the interest rates on ARM loans are higher than the 30yr fixed. There is no reason whatsoever to do an ARM loan right now.
Click to expand...

I believe you can get a LOWER interest rate with an ARM compared to a 30yr fixed. With an ARM, basically you'll be paying less now, but more later, which is good if you aren't going to keep the house very long, but bad if you want to get it more than 7 years. You'd consider getting something like this is if you think that interest rates are going to get LOWER, because the ARM is only for 7 years, but this is a very risky proposition and shouldn't be done. The other situation is if you are planning on investing the difference between the lower monthly payment you'd have with an ARM and a 30 yr fixed and you think you can get a greater return than the higher interest you will pay with an ARM. If that's the case, then you should look at interest only loans too, but those are getting more risky so you have to make sure you know what you are getting into.
 
Does anyone know if any of these "doctor's loans" programs are available to a medical student looking to purchase a home (or are they just for residents/docs)?

I'm in the process of getting a loan right now, and would like to consider all of my options.

Thanks in advance to anyone who could help!
 
Hi Playmakur, oops, I just realized I made a mistake when responding to your PM. From what I know, most lenders are only going to give you the doctor loan when you are or are about to become a resident.

Sorry about that!
 
hi everyone. i have a problem if anyone has any suggestions, i'd appreciate it.
here's my situation: i'm a transitional resident who is now going to be moving for my pgy2-4 program in june 08. i deferred my loans after my medical school graduation last year after the grace period (hence deferred from nov 07-nov08) through THE. i didn't have to find a place to live for my first year but now that i'm moving in june i am in the process of applying for a physicians loan.

all is good except that one of the requirements of the loan is for proof that my THE loans are deferred for 12 months from closing. i can't provide this proof because my loans are deferred through this nov 08, at which time i will reapply as usual.

they are saying this may make me not be able to qualify for the loan. (through bank of america)

any suggestions or has anyone else been through this?
 
Yes if you can't prove that you are deferring for 12 months, then most likely you won't be able to qualify for that particular loan. Sometimes they can get "exceptions" if the rest of your application has mitigating circumstances, lower LTV (you put a downpayment), good credit, lower DTI, etc.

I'm merging this thread with the doctor's loan thread as I'm trying to consolidate the questions.
 
4424 said:
hi everyone. i have a problem if anyone has any suggestions, i'd appreciate it.
here's my situation: i'm a transitional resident who is now going to be moving for my pgy2-4 program in june 08. i deferred my loans after my medical school graduation last year after the grace period (hence deferred from nov 07-nov08) through THE. i didn't have to find a place to live for my first year but now that i'm moving in june i am in the process of applying for a physicians loan.

all is good except that one of the requirements of the loan is for proof that my THE loans are deferred for 12 months from closing. i can't provide this proof because my loans are deferred through this nov 08, at which time i will reapply as usual.

they are saying this may make me not be able to qualify for the loan. (through bank of america)

any suggestions or has anyone else been through this?
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I was told by my BoA representative that they do not look at medical school loans for the physician loan program. I have not gone through and filled out the actual paperwork yet, but that was the understanding that I had... If it really is a requirement, maybe you could contact your lender and ask if they can provide a statement to you or the bank stating that based on your income, your loans, and the calculations in November, you would qualify for a 12-month deferment at that time?
 
4424 said:
hi everyone. i have a problem if anyone has any suggestions, i'd appreciate it.
here's my situation: i'm a transitional resident who is now going to be moving for my pgy2-4 program in june 08. i deferred my loans after my medical school graduation last year after the grace period (hence deferred from nov 07-nov08) through THE. i didn't have to find a place to live for my first year but now that i'm moving in june i am in the process of applying for a physicians loan.

all is good except that one of the requirements of the loan is for proof that my THE loans are deferred for 12 months from closing. i can't provide this proof because my loans are deferred through this nov 08, at which time i will reapply as usual.

they are saying this may make me not be able to qualify for the loan. (through bank of america)

any suggestions or has anyone else been through this?
Click to expand...

If you are applying with Bank of America, you might not have to prove that your loans are deferred. My BoA lender didn't ask me to send proof that they are deferred.
 
I definitely know you have to prove they are deferred for more than 12 months. You can prove it by the following: A medical resident who has not begun his or her residency must provide a letter from the employer verifying the medical resident’s start date. If you are an existing medical resident you must provide a letter from the employer verifying that at least six months of residency remain or a letter from the student loan servicer confirming that student loan payments have been deferred for at least 12 months, and if you are currently a medical doctor must provide a letter from the student loan servicer confirming that student loan payments have been deferred for at least 12 months.
 
Anyone get a physician loan in Philly lately? I've had one guy tell me that the whole city is "declining" and thus the 0-down is unavailable. He said that they use the Case-Schiller index to determine this. Other BoA guys said that it depends on the appraiser. Any thoughts?
 
zinjanthropus said:
Try Compass Bank (Drew Daniels) - they got me a loan with 100% in a "declining market" where BOA wanted 5% down.
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They don't have a physical presence in Philly, unfortunately. Thanks for the suggestion, though.
 
plnii said:
Anyone get a physician loan in Philly lately? I've had one guy tell me that the whole city is "declining" and thus the 0-down is unavailable. He said that they use the Case-Schiller index to determine this. Other BoA guys said that it depends on the appraiser. Any thoughts?
Click to expand...


BoA gave me a good faith estimate for a 0% down/no pmi physicians loan, then rescinded it using the "declining values" excuse. They also said that the no money down deal is only for those with a credit score over 775. I called them out for being sleazy salesmen using the bait-n-switch, so they came back with a no fee mortgage that called for 10% down with no pmi. I'm actually happier with this deal because the majority of my closing costs will be applied directly to the principal. PM if you need my BoA contacts contact info.....and beware the bait-n-switch!
 
zinjanthropus said:
Doesn't matter - they don't have one in my city either. They underwrite in all 50 states. I would give drew an email and see if he can help you out.
Click to expand...

Thanks for replying...I think that you are right. They are offering zero down even in declining markets. We'll see how their rate compares...
 
Playmakur42 said:
BoA gave me a good faith estimate for a 0% down/no pmi physicians loan, then rescinded it using the "declining values" excuse. They also said that the no money down deal is only for those with a credit score over 775. I called them out for being sleazy salesmen using the bait-n-switch, so they came back with a no fee mortgage that called for 10% down with no pmi. I'm actually happier with this deal because the majority of my closing costs will be applied directly to the principal. PM if you need my BoA contacts contact info.....and beware the bait-n-switch!
Click to expand...

Yeah, the No Fee is not bad but the GFEs (Good Faith Estimate) I have seen have the APR jacked up pretty high. BoA is still doing 5% down Physician Loans in Philly (no PMI is the only benefit here), which I am considering as well as FHA (3% down) and now the Compass Bank 0 down.
 
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what kind of rates and from whom are people recieving? I was quoted 6.375 for 5/1 ARM and 8% for 30 year fixed from Compass.
 
acs62c said:
what kind of rates and from whom are people recieving? I was quoted 6.375 for 5/1 ARM and 8% for 30 year fixed from Compass.
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The 5/1 ARM seems reasonably competitive, but you could probably find a lower rate if you make the lenders compete w/ each other.

The 30 yr fixed is way high. That should be right around the same number as the 5/1 ARM.
 
the fixed quote seemed quite high to me as well. I was a bit surprised at that. This was from the Drew Daniels/Jennifer Baugh team that has been previously discussed in the SDN forums.

Anyone have any recent quotes from BoA?
 
acs62c said:
the fixed quote seemed quite high to me as well. I was a bit surprised at that. This was from the Drew Daniels/Jennifer Baugh team that has been previously discussed in the SDN forums.

Anyone have any recent quotes from BoA?
Click to expand...

Unfortunately the rates have gone up quite a bit over the last month. I was originally quoted 5.125% on a 5/1 ARM by Compass in late May. By the time I found a place though in early June, the rate had moved to 6% (!). Fortunately, my seller is paying 6% closing costs so there was a enough for a rate buy down. Compass let me buy 1.75 points and get the rate back to 5.125%
 
zeloc said:
I believe you can get a LOWER interest rate with an ARM compared to a 30yr fixed. With an ARM, basically you'll be paying less now, but more later, which is good if you aren't going to keep the house very long, but bad if you want to get it more than 7 years. You'd consider getting something like this is if you think that interest rates are going to get LOWER, because the ARM is only for 7 years, but this is a very risky proposition and shouldn't be done. The other situation is if you are planning on investing the difference between the lower monthly payment you'd have with an ARM and a 30 yr fixed and you think you can get a greater return than the higher interest you will pay with an ARM. If that's the case, then you should look at interest only loans too, but those are getting more risky so you have to make sure you know what you are getting into.
Click to expand...


I have a question: My wife is planning on attending a residency out of state. It'll take up a max of 6 years and then we plan to move back to our current state. We would like to buy a home, however, during this time. Would you suggest something like a 7/1 ARM since we know, for sure, that we won't be in the house longer than 7 years? It would be nice to have the lower payments per month so we could use that towards 6.8% student loans, you know?

Thanks for the help! I'm so new with this stuff. I'm trying to figure out all this Doctor Loan stuff too. We have money for about a 10% down payment, but I'd like to get a nice loan amount so we can live in a great home for the next 6 years. I guess I have another question then: with the BOA Doctor Loans, are they favorable because you can get 0% down or because they look past student loans and give nicer loan amounts? Or both?
 
8% on a 30 year fixed from Compass? Wow! That's very high. Bank of America has been around 6.5%. I've been working with Deborah Wilson. If there's any chance that you would be in the home longer than 7 years, I'd definately go with the fixed loan.
 
RustyGator said:
I have a question: My wife is planning on attending a residency out of state. It'll take up a max of 6 years and then we plan to move back to our current state. We would like to buy a home, however, during this time. Would you suggest something like a 7/1 ARM since we know, for sure, that we won't be in the house longer than 7 years? It would be nice to have the lower payments per month so we could use that towards 6.8% student loans, you know?

Thanks for the help! I'm so new with this stuff. I'm trying to figure out all this Doctor Loan stuff too. We have money for about a 10% down payment, but I'd like to get a nice loan amount so we can live in a great home for the next 6 years. I guess I have another question then: with the BOA Doctor Loans, are they favorable because you can get 0% down or because they look past student loans and give nicer loan amounts? Or both?
Click to expand...

The BOA loans are definitely favorable for both of those reasons. How much do you mean when you say nice loan amount?
 
doctorloans said:
The BOA loans are definitely favorable for both of those reasons. How much do you mean when you say nice loan amount?
Click to expand...

Could I have been any more subjective by saying "nicer loan amount"? Sorry. I really have absolutely no idea how much we would qualify for, but I was hoping a "nicer" amount to be something like $300-350K.
 
What you want is a physician's loan that there is 0 money down, no mortgage insurance, and they do not count your student debt, if it is deferred for at least one year. The best interest rate would be either the 5/1 year arm or in your case the 7/1 year arm...since you will be selling it in 6 years. You don't want to pay rent!
 
Hi Rusty, here is something that *might* help, taken off the FAQ on our site:

Q: As a resident, how much can I borrow?
A: Most residents make around $40,000 - $50,000, but it depends where they're practicing and how long they've been in residency. Credit cards and other debt will affect how much you are able to borrow. The best way to find out is talk with a mortgage lending officer.
 
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