What is a physician loan?
A physician loan is a special type of loan designed for the unique needs of doctors. Because doctors have the ability to earn a higher income, this type of loan was designed. Doctors often find themselves with very high student loan debt, limited cash and minimal credit during med school and residency.
These programs offer several benefits to physicians, such as:
- Lower down payment requirements: Physician loan programs typically require a lower down payment than traditional mortgages. Lenders recognize physicians often have high earning potential but may not have significant savings for a down payment.
- No private mortgage insurance (PMI): PMI is typically required for borrowers who put down less than 20% on a home purchase. Physician loan programs often waive this requirement, which can save physicians thousands of dollars over the life of the loan.
- More lenient credit requirements: Because physicians typically have a high earning potential and a stable career, lenders may be more flexible with credit requirements for physician loan programs.
