Mortgage Question for those who bought before starting residency

[WhatAmIDoing]

I'm a month and a half before graduation, and wanting to use this downtime to secure a house before intern year starts. My husband is working and qualifies for a loan, but not enough for the house we want. I don't know what to do to co-apply.

-How do you show proof that loans are deferred/in forbearance before you graduate?
-Will lenders take a contract letter with salary on it in lue of pay stub?
-What other documents do I need to get a mortgage?

Thanks to anyone who can help! I don't want to wait until July and am too busy to deal with closing.

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[edmadison]

I'm a month and a half before graduation, and wanting to use this downtime to secure a house before intern year starts. My husband is working and qualifies for a loan, but not enough for the house we want. I don't know what to do to co-apply.

-How do you show proof that loans are deferred/in forbearance before you graduate?
-Will lenders take a contract letter with salary on it in lue of pay stub?
-What other documents do I need to get a mortgage?

Thanks to anyone who can help! I don't want to wait until July and am too busy to deal with closing.

I had no trouble 5 years ago using a letter from my residency program about my future income. Things have changes since then, of course. I would contact your lender(s) directly an ask them the question.

Ed

 

[dragonfly99]

They will want a signed letter/contract from your residency program.

For most loans, they want to see 2-3 months of your pay stubs. If you are a med student, you will not have that, which can be a problem. You may be able to qualify for a mortgage using your spouse's income, if you have a spouse.
Otherwise, you can go for one of the doctor loan programs...there are not as many around now, though, and generally they do not offer very favorable interest rates (1-2% higher than other loans).

If you have a spouse who works, then check out conventional loans. FHA loans only require 3.5% down. If you have 20% down and current income/a job, you can get a normal conventional loan which is generally the best. FHA loans are all right but include more fees, and you have to pay mortgage insurance which is just extra money you pay every month which protects the bank in case you default on your loan.

 

[Sol Rosenberg]

They will want a signed letter/contract from your residency program.

For most loans, they want to see 2-3 months of your pay stubs. If you are a med student, you will not have that, which can be a problem. You may be able to qualify for a mortgage using your spouse's income, if you have a spouse.
Otherwise, you can go for one of the doctor loan programs...there are not as many around now, though, and generally they do not offer very favorable interest rates (1-2% higher than other loans).

If you have a spouse who works, then check out conventional loans. FHA loans only require 3.5% down. If you have 20% down and current income/a job, you can get a normal conventional loan which is generally the best. FHA loans are all right but include more fees, and you have to pay mortgage insurance which is just extra money you pay every month which protects the bank in case you default on your loan.

You only need a minimum of 5% down to do a conventional loan (< 20% means you have to pay for PMI, or do a piggyback loan though....)

 

[CarleneM]

I know Compass Bank will allow closing 90 days before you start residency with your contract and your co-borrower's paystubs. This is on a physician loan so the rates aren't so hot. With FHA, you'll need paystubs yourself b/c you said you don't qualify for enough based on your co-borrower's income alone so I don't think this would be an option for you. I think most conventional mortgages will want this type of documentation as well and only special underwriting, such as with the physician loans, allows otherwise. I have heard conflicting stuff regarding Suntrust's policy on closing before residency starts on physician mortgages. Maybe someone that is working with them can clarify. I am trying to reach a different person than I talked with b/c the Suntrust guy i spoke with didn't get that we match and will not be getting other job offers and seemed to want to work only with rich,established physicians.

 

[dragonfly99]

I asked some banks about doing conventional loans with 5% down, but was told that they are not doing those right now (i.e. the piggyback loans, etc.). This may depend on the market you are in (i.e. banks may not like to do these types of loans in declining markets, etc.). B of A used to have a doctor loan that was only 5% down in declining markets, but that has been done away with.

 

[drguy22]

I know Compass Bank will allow closing 90 days before you start residency with your contract and your co-borrower's paystubs. This is on a physician loan so the rates aren't so hot. With FHA, you'll need paystubs yourself b/c you said you don't qualify for enough based on your co-borrower's income alone so I don't think this would be an option for you. I think most conventional mortgages will want this type of documentation as well and only special underwriting, such as with the physician loans, allows otherwise. I have heard conflicting stuff regarding Suntrust's policy on closing before residency starts on physician mortgages. Maybe someone that is working with them can clarify. I am trying to reach a different person than I talked with b/c the Suntrust guy i spoke with didn't get that we match and will not be getting other job offers and seemed to want to work only with rich,established physicians.

I am working with Suntrust currently. Their policy is that you can close before the start of your residency BUT you must have at least one paycheck deposited before your first payment it due, which is about 30-60 days depending on when you settle. AWESOME rates. im getting a 7-1 ARM for 4.75, which is fine with me because I'm prolly not going to stay there longer that 5 years. I think their 30 year fixed is 5.25.

 

[sleepingneuro]

I am working with Suntrust currently. Their policy is that you can close before the start of your residency BUT you must have at least one paycheck deposited before your first payment it due, which is about 30-60 days depending on when you settle. AWESOME rates. im getting a 7-1 ARM for 4.75, which is fine with me because I'm prolly not going to stay there longer that 5 years. I think their 30 year fixed is 5.25.

Hey drguy- if you dont mind me asking, what credit score is getting you these rates? >700?

 

[drguy22]

Hey drguy- if you dont mind me asking, what credit score is getting you these rates? >700?

> 750

gonna start residency soon...