5 Best Physician Mortgage Loans in Michigan

Bordered by four of the five Great Lakes, the Midwestern state, Michigan, is a peninsula that is actually separated into two different parts. It was the 26th state and was admitted to the US in 1837. Since then, Michigan has earned a number of nicknames, including “The Great Lake State,” “The Wolverine State,” and “The Mitten State.”

The Michigan housing market has been making some interesting moves recently. According to the Michigan Realtors Association, the average sale price was $253,557, which is a growth of 5.29% from the year prior. These figures show the demand for homes and the lack of inventory that has caused concern in some areas as it drives up home values. 

As a dentist or one of the over 28,000 doctors living and working in the state, you may wish to consider the Michigan physician mortgage loan program if you hope to buy a home in the state. This program may enable qualified professionals to secure a low- or no-down-payment home loan. 

Pros/Cons of Michigan doctor mortgage loans

Are you considering a Michigan physician mortgage loan? You will likely want to think about both the pros and cons that can come with these loans. Since most medical residents or medical school graduates don’t have a first property to refinance, it can be hard to come up with the down payment required for a traditional loan. With an employment contract in hand, however, you’re more easily able to find a perfect place through a realtor or a NMLS search and use that instead to qualify for a doctor loan.

If you’re seeking a primary residence but concerned about budgeting for that down payment or lower credit scores from high student loan or credit card balances, do your research to see is physician mortgage loans are an option.

Physician loans for Michigan professional offer a range of advantages, including:

• Higher loan limits that allow you to put in offers on a wider array of homes
• Special treatment of student debt, which can be considerable for doctors and other professionals
• No required PMI payments

Perhaps the biggest advantage with a doctor mortgage? You may likely qualify for one with little to no money. This can be a big “pro” when many conventional loans require down payments as high as 20 percent. This can be a substantial amount for healthcare homeowners because of the purchase price of homes they are looking at. With a traditional loan, it’s easy to feel like new home ownership is just out of reach. Thankfully, doctor home loans might be a potential solution so long as the doctor knows all the details about repayment and the life of the loan.

And the cons? There are some, though they may not outweigh the pros. Some downsides of physician loans include higher interest rates in some instances and the fact that you may need to open an account with the lending bank. In some rare instances, borrowers may buy more house than they need with a doctor mortgage, due to the higher limits available. 

As with any search, knowing the right mortgage lenders and comparing interest rates, mortgage payments, closing costs, and other details can help you decide which bank to work with. Make sure you’re budgeting for all expenses in your new job, too, so that your monthly payment for the mortgage doesn’t get too high.

5 Top Michigan physician home loan lenders

If you’re in the market for a home in Michigan, consider these physician mortgage loans that are available to state residents.

Huntington Bank

Huntington Bank is the 26th largest bank in the United States. Operating primarily out of the Midwest, their mortgage group can service a large part of the country. Huntington has a competitive physician loan product with no money down financing options.

We contacted a loan officer at Huntington Bank to gather information about the doctor mortgage and here’s what we heard back:

• 0% down payment up to $1 million
• 5% down payment up to $1.25 million
• 10% down payment up to $2 million
• Maximum financing up to $2 million
• Eligible degrees are: MD, DO, DDS, DVM or DMD
• Residents are eligible
• Minimum credit score is 700
• 2 months reserves required (6 months for jumbo loans) – reserves can be held in bank or investment accounts
• Gift funds for down payment are OK
• 30-year and 15-year fixed-rate mortgages
• ARMs available in 7/6, 10/6 or 15/6 terms
• Can close on the strength of a new employment contract without paystubs
• No private mortgage insurance
• No prepayment penalty

When you’re ready to connect with a loan officer experienced in doctor mortgages, use our form to quickly match with eligible loan programs based on your specific circumstances.

Citizens Bank

Citizens Bank is one of the largest banks in the Untied States. I bet you didn’t know that it’s headquartered in the smallest state: Rhode Island. With over $160 billion in assets, it’s no surprise that Citizens offers a full range of financial products, including a physician loan.

We contacted a loan officer at Citizens Bank to learn more about their doctor mortgage loan program specifically. Here are details you won’t find anywhere else:

• 5% down up to $850,000
• 10% down up to $1,000,000
• Practicing licensed medical doctors (MD and DO), dentists (DDS and DMD), residents and research physicians are eligible
• Licensed residents, fellows and interns can borrow a maximum of $600,00 (or $400,000 if unlicensed)
• No more than 10 years out of residency
• Self-employed professionals are eligible with a two-year history of self-employment income
• New medical professional graduates who are under contract for residency within 60 days of closing and have not yet obtained a license are eligible
• No private mortgage insurance
• 40% max debt-to-income ratio
• Student loan debt that’s deferred for more than 12 months from the date of closing can be excluded from DTI calculations
• Construction-to-permanent loans available with a maximum of 89% financing
• Fixed rate or adjustable-rate mortgage options
• Interest-only option on certain adjustable-rate mortgage options (max financing at 89%)

When you’re ready to connect with a loan officer experienced in doctor mortgages, use our form to quickly match with eligible loan programs based on your specific circumstances.

Is a Michigan physician mortgage loan right for you?

Deciding on a financial commitment such as a physician mortgage loan means taking careful stock of all the implications involved and how it will impact your life. Do you intend to stay in your town for many years to come, or in your job for the same period of time? Then entering into a doctor mortgage may work for you. 

Are you okay with potentially paying a higher interest rate? It may cost you more over the life of your loan, but you may also find that to be worth it, since you get so many benefits with these loans. Take into consideration that you will have a relationship with the lender for years to come; this can help you or your practice in the future. 

Examples of physicians who take out physician home loans in Michigan

Let’s take a moment now to discuss who the doctors are that are taking out physician loans in Michigan. You may find that their stories are similar to yours.   

Doctor who hasn’t yet saved up a down payment

Many doctors work hard during medical school, both in the classroom and out, but few come out of their studies with much in savings. When student debt is added into the equation, taking out a mortgage can be difficult. That is definitely the case with Sasha, who recently began a residency at University of Michigan hospital. While she is on track to be a high earner since her specialty is in orthopedics, she doesn’t have money for a down payment yet. She could wait and try to qualify for a conventional loan once she saves up, but she wants to settle down now. A physician loan will allow her to buy a home with 100 percent financing and get her life on track ASAP. 

Doctor who wants to maximize leverage

Max has spent the better part of a decade building his family practice. Today, he has solid savings established and a portfolio of investments that are performing well. He and his wife want to buy a home for their family. In order to do so, he would have to use a good part of his savings or liquidate some investments to make a down payment. Proceeding, instead, with a doctor mortgage will allow him to maximize his leverage, retain the cushion of his savings and purchase a home with little to no down payment. 

Looking for a physician loan in a different state?

If you’re looking to explore the best physician loans in other states, click on your state below.