Mortgage preapproval?

Can I start shopping around for a mortgage now even though I haven't matched yet? I mean, can you get preapproved for a loan before you have your residency contract??

irishgirlmd said:

Can I start shopping around for a mortgage now even though I haven't matched yet? I mean, can you get preapproved for a loan before you have your residency contract??

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Yes. I've already be pre-approved for a doctor loan through Bank of America. It can be used for any location.

While it sounds like the pp was lucky, I highly doubt that most lenders would approve you when you can't prove an income (well, I guess you could do a no-document loan, but that requires all kinds of other things which most med students probably don't have, like substantial assets...). Matching is not a guarantee (said by someone who didn't match last year). The lenders I have spoken with (several, including BofA) cannot include me in the loan approval until I (hopefully!) get a contract in a few weeks - we are currently only approved on my husband's income.

Out of curiousity, why bother getting approved now? Are you 100% sure you know where you'll be, b/c if not what's the point of looking until you are certain? It's only a few more weeks, why not just wait.

randomedstudent said:

Out of curiousity, why bother getting approved now? Are you 100% sure you know where you'll be, b/c if not what's the point of looking until you are certain? It's only a few more weeks, why not just wait.

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Word thru the grapevine is that it can take up to 3 months AFTER match day before you get a contract.

If we got our contracts right after Match, there would be no problem, but waiting around 3 months after match until you get a contract is ridiculous

Well, its not that I need to find out right now but the problem is what the pp mentioned. I would like to start after the match as soon as possible but what if it takes awhile for my contract to get here? Also, my husband is a med student as well so we have no income 😕

randomedstudent said:

While it sounds like the pp was lucky, I highly doubt that most lenders would approve you when you can't prove an income

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Actually, you can get preapproved before you have an income and sign a residency contract. The doctor loans through Bank of America are specifically for us graduating med students, and you can get preapproved before you match. They use an average salary for residents as your income (since most residencies are around the mid-$40k range), and you can add your spouse's income into the mix, too, to preapprove for higher.

We just did a conference call one of the BofA people who specialize in these loans. She said that the maximum that a single graduating med student with the average starting intern year salary can preapp for is $205k. Two graduating med students who are married can qualify for double. Not enough for us, since we're going back to Cali. And with my husband's massive loan debt, it cancels out his income. Oh, yeah, if you're a med student, your student loan debt does not count in the preapproval amount if you're eligible for deferrals, so that's cool, too.

Anyway, there's a lot of other things about this loan, but we decided to hold off until next year to do it. But you can get preapproved now and start shopping after the match!! It's only the BofA Doctor loans though, that do this that I know of. I know other banks do, but I'm not sure who and what their deal is.

Good to know. Thanks so much for your help!🙂

Guys, my husband is a resident and I will be this summer - I know how the resident mortgages work. What I meant was not that you had to HAVE an income but rather you had to have PROOF of a future income. You do not have proof of any income until you match and you are not guaranteed to match. And you don't need the actual contract (which as pp mentioned you often don't get for weeks/months), but you need a letter from your residency program stating that you will in fact be a resident. At least this was the case with all the lenders I spoke with - none could approve me until I have matched. Maybe a few will do it before but I wouldn't count on it.

randomedstudent said:

Guys, my husband is a resident and I will be this summer - I know how the resident mortgages work. What I meant was not that you had to HAVE an income but rather you had to have PROOF of a future income. You do not have proof of any income until you match and you are not guaranteed to match. And you don't need the actual contract (which as pp mentioned you often don't get for weeks/months), but you need a letter from your residency program stating that you will in fact be a resident. At least this was the case with all the lenders I spoke with - none could approve me until I have matched. Maybe a few will do it before but I wouldn't count on it.

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They can do whatever they want b/c they just need the proof prior to closing, so if your loan falls through because you can't produce that, that blame will fall on you (and so might the fees).