Top 5 Benefits of a Doctor Loan
5 minute read
May 9, 2023


If you’re a doctor, you know that the cost of medical school can be daunting.  

One way to make it easier is to consider taking out a doctor loan. 

A doctor loan, also known as a physician mortgage loan, is specifically designed for medical professionals and offers unique benefits, with medical school debt in mind, that are not available with other types of loans. 

In this article, we’ll take a look at the top five benefits of taking out a doctor loan and how it can help you buy a home, even at the beginning of your career

Can doctors get a special mortgage?

Doctor loans are available to medical professionals who are just entering the field and may need more flexibility when it comes to buying a home. These loans are different from conventional mortgages and are only open to a select group. 

The top 5 benefits of a doctor loan

These loans offer many benefits, including the following. 

1) Lower interest rates

Typically, physician loans are adjustable-rate mortgages (ARMs). These loans usually have a lower fixed rate for the first years of the loan. This can save buyers hundreds to thousands of dollars a year in payments.

ARMs save money in the short term and also allow for flexibility if you plan on buying or selling the home in a short time period. This is common for those who are new in their medical profession and are moving around to find the right position.

A lower monthly payment can help you focus on paying off medical school debt while comfortably owning your own home and save you more money in the long run.

2) No PMI payments

Private Mortgage Insurance (PMI) protects a lender if a homeowner stops paying their mortgage. PMI is typically required for conventional loans with down payments lower than 20%.

Physician loans are unique because they don’t require borrowers to pay private mortgage insurance (PMI), even if they put 0% down. This can mean savings of hundreds of dollars a month. This is a big advantage for first-time homebuyers and especially medical professionals carrying a lot of debt.

3) Lower down payment requirements

Most physician loans require a much lower down payment than traditional mortgages, making it easier for doctors to purchase their first home. 

Most doctor loans only require a down payment of 0-10% of the purchase price. This is sometimes lower than a conventional loan which could require a higher down payment depending on your credit.

This can free up significant cash for a larger home, home repairs, or paying back student debt. This flexibility is a great advantage to homebuyers using a doctor loan, especially those just starting out.

4) Higher loan amounts

Physician loans usually have higher loan amounts than standard mortgages, making it easier for doctors to purchase a more expensive home. Lenders understand that a doctor’s salary will increase dramatically in the first 10 years and accounts for that by increasing the approved amount based on potential buyer power. 

This can allow home buyers to search for homes in a wider range of areas and buy the home they see fit for themselves.

5) Flexible loan terms

Most conventional loans require a debt-to-income (DTI) ratio of under 50%, which can be tough for doctors just out of medical school. 

Lenders expect doctors to have a higher DTI and are, therefore, more flexible on physician loans than with standard loans. 

Lenders recognize doctors’ high potential earnings and consider that when balancing the risks of taking on a new loan. 

This also applies to credit requirements, as doctor loans are often more lenient, making them ideal for physicians who may not have perfect credit or who are just starting out in their careers.

Additionally, many doctor loans don’t have prepayment penalties, so you can make extra payments when you can do so without incurring any additional costs. This allows you to pay off your loan faster and save on interest. 

Check your mortgage options

Can you get a doctor loan more than once?

Yes, many mortgage lenders offer repeat physician loans. This means that you can use the same doctor loan provider again if you need to purchase a new home or refinance an existing one. 

Doctor loans can only be used to finance a primary residence, not a second home or investment property. If this requirement is met, a doctor loan can be used over again.

Be sure to check with your physician loan provider for their specific requirements concerning repeat physician loans.

Is a doctor loan a good idea?

Doctor loans can be a great option for medical professionals who are looking to purchase or refinance a home.  

Because physician mortgage loans provide lower down payments, competitive interest rates, and assistance with closing costs, they can often be much more affordable than conventional mortgages. 

Additionally, doctor loan lenders are typically more lenient with credit score requirements and employment history, making them a great option for medical professionals who may not qualify for more traditional mortgages. 

Finally, physician mortgage loans often have much more flexible terms for their loans.

Get your doctor loan with GO Mortgage

By taking advantage of physician loans, you can make your dream of owning a home possible—even with medical student debt.

With lower interest rates and more flexible repayment options, physician loans offer many benefits for doctors looking to qualify for a mortgage. 

With the right physician loan, you can own a home in no time. Be sure to inquire with a loan officer experienced in doctor loans, such as those at GO Mortgage, about your options and what will fit your needs best.

Get started with GO Mortgage today!

Photo by Andrea Piacquadio

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