If you’re considering a doctor mortgage loan, one of the first questions on your mind is likely, “How much can I borrow?” This is a crucial consideration as you begin your journey into homeownership, especially as a new resident. While your current income might not support a luxury home purchase, a physician loan can help you secure a comfortable home early in your career.
Understanding Your Borrowing Power
As a new resident, you’re likely earning around $65,000 per year in most markets. This means that while you might not be purchasing a high-end home just yet, a doctor mortgage loan can still open doors to homeownership. Factors like your consumer debt, credit score, and whether you’ll have a co-borrower will all influence how much you can borrow.
The good news is that physician loan lenders generally don’t include your deferred student loans in your debt-to-income ratio. This makes it easier for you to qualify for a mortgage, even with substantial student loan debt. However, it’s important to remember that most traditional lenders who don’t offer physician loans will consider your student debt a significant risk and may not extend credit to you.
Using an Online Calculator for Estimates
To get a rough idea of what you might be able to afford, you can use an online mortgage calculator like this one from Zillow. Although these calculators are typically designed for conventional mortgages, they can be adapted for use with physician loans.
Here’s how to use it effectively:
- Uncheck PMI: Physician loans do not require private mortgage insurance (PMI), so be sure to uncheck this option in the calculator’s advanced settings.
- Input Local Data: Make sure to enter relevant local information, such as property tax rates, which can vary significantly depending on where you’re planning to buy. You can find property tax rates in your area using resources like this one.
These calculators are great for providing a starting point, but they’re not the final word on how much you can borrow. Every bank has different guidelines, and the exact amount you’ll qualify for can vary. That’s why it’s essential to get pre-approved for your doctor mortgage loan.
The Importance of Pre-Approval
While online calculators can give you a ballpark figure, the most accurate way to know how much you can borrow is to get pre-approved by a lender. Pre-approval gives you a clear picture of your borrowing power and ensures you can move forward with confidence. It also signals to sellers that you’re a serious buyer, which can be a significant advantage in competitive markets.
Our vetted lenders specialize in working with physicians and understand the unique financial situations you face. They’ll help you navigate the pre-approval process and provide you with a precise understanding of how much you can afford. This peace of mind is invaluable as you begin your home search.
Conclusion: Start Your Home Buying Journey
with Confidence
While it’s tempting to rely solely on online calculators to determine your borrowing power, remember that each bank has its own criteria. The best way to know for sure how much you can borrow is to get pre-approved by a lender who understands your specific needs as a physician.
Whether you’re just starting residency or you’re further along in your career, securing a doctor mortgage loan can help you achieve homeownership sooner than you might think. Complete our “Get Started Now” questionnaire to be matched with the best bank for your specific needs and location, begin the pre-approval process, and take the first step towards finding the home that’s right for you.
