Bank of America
Bank of America is one of the original lenders (if not THE original lender) in the physician mortgage space. With over $3 trillion in assets, it’s one of the largest banks in the United States and chances are good that you are familiar with the company. Not surprisingly, they still offer a doctor mortgage product.
We reached out to a Bank of America mortgage officer to get more details about their program and this is what we learned:
- 5% down up to $1,000,000
- 10% down up to $1,500,000
- Residents and fellows with a job lined up can close on a home 90 days before they start.
- You can often exclude your student debt from your total debt when you apply for a mortgage.
- Eligible medical professionals include salaried medical students and medical doctors who are about to begin their new employment/ residency for fellowship within 90 days of closing. Those employed in research or as professor are not eligible.
While they may not have the most competitive program, they are a solid choice for a physician looking for a doctor mortgage, particularly if you’re already banking with Bank of America.
Of course, if you aren’t already a current Bank of America customer, they will require you to have, or open prior to closing, a checking or savings account. Applicants with an existing account with Merrill or Bank of America Private Bank prior to application also satisfy this requirement.
When it comes to reserves, Bank of America requires PITIA (Principal, Interest, Taxes, Insurance, Assessments) reserves of 4 – 6 months, depending on loan amount.
If applicant’s employment does not commence until after closing, in addition to the minimum cash reserves required, sufficient reserves to handle all debt obligations between closing and employment start date up to an additional 90 days must be verified.
When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.
Bank of England
If you thought the Bank of England was in the United Kingdom, you’ll be surprised to find out that the Bank of England is located in England, Arkansas but has the ability to lend in all 50 states (except NY).
We contacted the Bank of England to see if we could gather details about their physician loan program. Here is what we learned:
- 0% down up to $1,000,000
- 5% down up to $1,500,000
- No PMI
- Only available on 3, 5 and 7-year ARM terms
- Program aimed at doctors who either seasoned practitioners or just out of medical school (in other words, they work with doctors of all experience levels).
- Requires a credit score of 700
- Requires two months of payment reserves.
- You can be a US Citizen or a Permanent or Non-Permanent Residence.
- They are able to exclude student loan debt in deferment or forbearance of 12+ months from the debt-to-income calculation.
- You can only use this doctor mortgage program for single family residences, condos and two-unit properties.
When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.
Is an Alaska physician mortgage loan a good idea for you?
Is an Alaska doctor mortgage the right option for you? There are a few questions you can ask yourself when making this decision.
First, consider whether it is the best time for you to buy. Ask yourself:
- Is your job one you foresee yourself staying with in the long term? Over time, even the best job may not be the best fit. It can take more than two years to determine whether you are in a job you want to commit to for years to come. If you are just starting a position, it may not be the right time to commit to a home purchase.
- How much home can you afford? Putting 0 down on a home can also make you feel like you can afford more house than you should. Financial experts often advise keeping a home purchase to around two times your annual salary. Committing to a doctor mortgage in Alaska comes with a lot of benefits, but you don’t want to get into a scenario where your mortgage becomes unaffordable for you.
- Is getting the lowest rate important to you? Some professionals considering these loans may also want to find the lowest rates possible. Since conventional loans with 20 percent down are usually the best answer to finding a low rate, some doctors may want to forego a physician mortgage, save toward that down payment and get that lower rate.
Of course, while a physician loan in Alaska comes with some compromises, you do get to establish a solid, long-term relationship with a bank. After all, banks created these products in order to do just that with professionals like you. Entering into one of these mortgages can leave you with a strong financial product throughout your life and career.
Examples of Alaskan doctors using physician loans
Who are some of the doctors in Alaska taking advantage of physician mortgage loans? The following narratives are good examples of the professionals who are ideal matches for a doctor mortgage.
Physician who hasn’t saved up a down payment
Ed committed a lot to becoming a doctor, taking out big student loans and working hard at school. Now that he is starting a residency in orthopedics at Providence Alaska in Anchorage, it seems clear that his career is on track and he will soon be earning an impressive salary.
The problem is that Ed has very little money to put down on a traditional mortgage. An Alaska bank that is known for their physician loans seems like the best way forward; he can get that mortgage with no money down and will likely have a good financial partner in that bank as his career flourishes.
Dermatologist who wants to maximize leverage
Maxine has established one of the most popular dermatology practices in Anchorage and has managed to build up her savings. A few years back, she invested part of her savings in a portfolio, and it has been performing reliably. She wants to maximize her leverage and keep her investments in place for the time being. Rather than liquidate those holdings to get the cash for a down payment, Maxine decided to go with a doctor mortgage with no money down from a prominent local lender.
Looking for a physician loan in a different state?
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