Headquartered in Cleveland, Ohio, KeyBank, a subsidiary of KeyCorp, has been a reliable national bank since 1825. Medical professionals, from recent graduates to experienced practitioners, can take advantage of KeyBank’s physician’s mortgage program, which streamlines the process of purchasing and investing in a primary residence.

Why choose KeyBank? Many traditional real estate mortgage programs aren’t easily accessible to medical graduates or healthcare professionals who have substantial amounts of outstanding student debt that can reach into the hundreds of thousands of dollars. On average, medical students in the US graduate with between $200,000 and $300,000 in student loans, which impacts your credit score considerably. Because your credit score is taken into account when applying for a mortgage, this can present a challenge.

A physician’s mortgage from KeyBank can help you achieve your dreams of homeownership once you’re a practicing professional, which can assist significantly on your path to financial autonomy.

Here’s a look at the benefits and drawbacks to KeyBank’s doctor loan program to help you make the best decision. 

Pros/Cons of KeyBank physician mortgage loans

KeyBank has multiple loan options to choose from to help you strive towards your future. It doesn’t matter how long you’ve been practicing and you can even qualify without US citizenship. 

Pros

Obtaining a physician’s mortgage with Keybank can be beneficial in a variety of ways.

Available nationwide. KeyBank is offering mortgages across all 50 states which makes this an accessible program. 

No minimum or maximum years in practice. Many other physician’s mortgages require you to have been practicing within your medical profession for no more than 5 or 10 years. With KeyBank, you can obtain a physician’s mortgage at any time in your career. This is a distinct advantage for those who may be purchasing their single family home or condo later in life and for those who are buying a second or third home or hoping to refinance a home. KeyBank doesn’t stipulate their loans are only available to first-time home buyers, creating wider availability.

You don’t need to be a US citizen. This mortgage program is available to US citizens, and also permanent residents, as well as those working in the US on an H1B visa. 

You can go higher than max loan amount listed. Research indicates you can obtain a mortgage with KeyBank for more than $2,000,000. Just be aware that you will likely be required to have 15% to 20% or more to put towards your down payment depending on your loan-to-value (LTV) of your home. 

Gifting is OK. Part of your down payment can be supplied in money you’ve received as a gift. 

Delayed employment date is OK. You can obtain this physician’s mortgage with proof of employment (using an offer letter or employment contract) up to 90 days after your closing date, and your future income will be considered for approval. 

Flexible calculations. Special formulas are used when calculating your debt-to-income ratio. This means your student debt won’t harm your application as much as it could when applying for a traditional mortgage. Income-driven student loan payments are included. 

Variety. KeyBank offer a variety of physicians mortgages with the interest rate options:

• 30, 25, 20,15 and 10-year fixed-rate mortgages 
• 5/6,7/6, and 10/6 adjustable-rate mortgages (ARM)

No prepayment penalties. Unlike with some mortgages offered by competitors, you won’t be penalized with extra fees if you repay your loan earlier than planned or make extra monthly payments. 

Cons 

As with any program, the physician mortgage program offered by KeyBank has a few drawbacks.

Fees. KeyBank charges a lender fee of $1,095 in order to process your mortgage, and there are also other closing costs that meet average standard 3rd party fees. 

Cap on DTI ratios. This program caps your debt-to-income (DTI) ratio at 50%. This is both good and bad. A DTI of 50% is high and if you do choose to apply for a mortgage with this and succeed, you could have limited funds available for an emergency situation, as well as limited additional borrowing options. 

Minimum credit score. KeyBank requires you to have a minimum credit score of 700, which is about average in the US. If you have a lower credit score than this, you won’t qualify. 

Residents and fellows don’t qualify. This doctor’s mortgage isn’t as widely available as some others (excludes veterinarians) and is only offered to medical doctors, dentists (DMDs), and dental surgeons.  

Reserve funds required. In order to be approved, borrowers will need to show proof of:

• 2 months reserves for loans under 500k
• 4 months reserves for loans over 500k
• 6 months reserves for loans over 750k, plus an additional 2 months if closing prior your start date 

All reserves are verified but not collected. 

How to apply

To apply for a physician’s mortgage with KeyBank, visit the company’s website and search their directory to locate a mortgage loan officer in your area. You can also call KeyBank at: 1-888-KEY-0018

When applying for a mortgage you will often need to supply personal information to mortgage lenders for underwriting that may include the following:

• Your full name
• Phone number
• Email address
• Date of birth
• Proof of income
• Your tax returns from recent years
• Information related to your present debt (credit card statements, credit score)
• Recent bank statements (savings accounts, checking accounts, etc.)
• Proof of education
• Your social security number

Is using a KeyBank doctor mortgage a good idea?

KeyBank offers a competitive physician home loan with the option to supply 0% down. If you’re a working medical professional in the US with an average or above average credit score, this program could be beneficial for you.

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