Mortgages

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I'm thinking about buying a house as an MD/PhD student, and haven't seen much in the finance section that deals with mortgages and the MSTP stipends, most talk about trying to be approved with a student loan. Has anyone here done this? How did it work out? Did you end up working with a bank or another company, or someone that specializes in loans for medical people? Would be great if anyone knows, would save me a ton of leg-work (if that's what you still call it when it can all be done sitting in front of a computer!)

Thanks!

 

[Picklesali]

I've been thinking about this too, as more than one of my hosts have done this.

Don't quote me - but I think they went through the bank and having proof of a constant income (MSTP stipend) was more than enough to secure them a mortgage.


Anyone one else have first-hand experience with this? I'd like more info as well.

 

[Sulfinator]

My wife and I secured a mortgage for a condo about 3 years ago (when I was a 3rd year student and my wife was also still working on her masters at the time). We didn't have any trouble, although we had to get her parents to co-sign.

Since then, my wife has gotten her masters and has a real job. We've been working hard (or rather she's been working hard) to pay off as much of the mortgage as we can before I have to do residency somewhere. For us the purchase has definitely been worth it.

By the way, when we were talking to banks about getting a mortgage, we were told that the banks could not count any student loans as income (for purposes of determining what, if any, rates and terms you qualify for).

 

[jlamacc1]

Are deferred student loans (from undergrad) included in debt calculation?

 

[Sulfinator]

Are deferred student loans (from undergrad) included in debt calculation?

I couldn't say for sure, but I would think that they almost certainly would be included in debt calculation. I can say for sure that the few loans that I did take out in my second year of medical school were included in the calculation.

 

[offtheline]

I'm thinking about buying a house as an MD/PhD student, and haven't seen much in the finance section that deals with mortgages and the MSTP stipends, most talk about trying to be approved with a student loan. Has anyone here done this? How did it work out? Did you end up working with a bank or another company, or someone that specializes in loans for medical people? Would be great if anyone knows, would save me a ton of leg-work (if that's what you still call it when it can all be done sitting in front of a computer!)

Thanks!

I actually just purchased a home in July and it has been a wonderful investment for me. I bought a foreclosure and got a really amazing deal. I would recommend it to any MD/PhD students because of the equity you can build over the time that you will undoubtedly be in school. I went about the process by securing a letter from my MD/PhD program administrator with the yearly stipend amount and for the number of years that I would be receiving it (you may omit this if it is beneficial).
I spoke with multiple mortgage companies and explained my situation. They were willing to work with me and told me the highest purchase price (loan) they would pre-approve me for as well as interest rates that I could expect. I finally chose countrywide as a lender and they have been great.

I purchased the house with only 3% down on an MD/PhD salary. No co-signer or anything. As you can imagine, it isn't a 5 bedroom mansion. However, I was able to pick something up that is cute, comfortable, and large enough for us to have a child in the future. It is somewhat of a fixer upper, but after minor upgrades including a fresh coat of paint on the interior walls and some exterior fixes, estimates from people in the real estate business say that I have already increased the value of the house by 15k.

Anyhow, good luck to you. As I said before, I think purchasing a house while in an MDPhD program is financially a very smart move if you can swing it. And, with the current state of the housing market, you just won't find better deals on houses as you will right now.

 

[mudphudwannabe]

Back when my husband and I were first looking for a place to live, we went to the bank to see what we could get for loans based on our incomes separately or together. He's self employed and at the time didn't have a lot for a down payment, so that made it tricky. Based on my ~$20,000 a year, they would have given me a $100,000 mortgage, no cosigner or anything. Anything above that and I would have needed a substantial down payment. At the time I had good credit, but not very much of it -- if you have a higher credit score you might be able to get a little better deal. The catch is, I would probably not have been able to make the payments on a $100,000 mortgage (I can't remember what the interest rate was at the time) -- it would probably work out if you had roommates. But, around here $100,000 doesn't get you much - maybe a small 1 bedroom condo. Real estate is really overpriced (IMHO) here. We decided to rent for another year, and my husband got a sweet deal working for the government so we were able to get a loan based solely on his income the next year.