As a physician assistant (PA), I understand the unique financial challenges we face, especially when it comes to purchasing a home. Balancing substantial student loan debt with the desire to invest in property can be daunting. Fortunately, several mortgage options are tailored to healthcare professionals like us, offering favorable terms to make homeownership more attainable.
Table of Contents
Understanding Physician Assistant Mortgage Loans
Physician assistant mortgage loans, often referred to as “physician loans,” are specialized mortgage products designed to meet the needs of medical professionals, including PAs. These loans typically offer benefits such as:
- Low or No Down Payment: Many programs provide financing up to 100%, eliminating the need for a substantial upfront payment.
- No Private Mortgage Insurance (PMI): Lenders often waive PMI requirements, reducing monthly payments.
- Flexible Debt-to-Income (DTI) Ratios: Some programs exclude deferred student loans from DTI calculations, making it easier to qualify.
- Competitive Interest Rates: Access to favorable interest rates compared to conventional mortgages.
These benefits acknowledge the financial trajectory of medical professionals, who often have high earning potential but may carry significant educational debt.
Eligibility Criteria
While specific requirements vary by lender, common eligibility criteria include:
- Professional Status: Proof of employment as a physician assistant or a contract indicating imminent employment.
- Creditworthiness: A strong credit score, typically 700 or higher.
- Primary Residence: The loan must be for a primary residence; investment properties usually don’t qualify.
- Geographical Restrictions: Some programs are limited to specific states or regions.
It’s essential to consult with lenders to understand their specific criteria and ensure you meet the necessary qualifications.
Comparison of Top Physician Assistant Mortgage Lenders
To assist in navigating the available options, I’ve compiled a comparison of notable lenders offering mortgage programs for physician assistants:
| Lender | Financing Options | Minimum Credit Score | States Available | PMI Requirement | Student Loan Consideration |
|---|---|---|---|---|---|
| Flagstar Bank | Up to 100% financing for loans up to $1 million | 720 | All 50 states | None | Deferred student loans may be excluded from DTI calculations. |
| First National Bank of Omaha | Up to $850,000 with no down payment | 720 | CO, IL, IA, KS, NE, SD, TX, WY | None | Deferred student loans may be excluded from DTI calculations. |
| Evolve Bank & Trust | Up to 100% financing for loans up to $1 million | Not specified | All 50 states | None | Deferred student loans may be excluded from DTI calculations. |
| First Citizens Community Bank | 100% mortgage and 80/20 mortgage options | 700 | AZ, CA, CO, FL, GA, KS, MD, MO, NE, NV, NM, NC, OK, OR, SC, TN, TX, VA, WA, WV, WI | None | Deferred student loans may be excluded from DTI calculations. |
| The Federal Savings Bank | Financing up to $2 million | Not specified | All 50 states | None | Deferred student loans may be excluded from DTI calculations. |
| Premier Bank | Up to $750,000 with no down payment | Not specified | IN, MI, OH, PA | None | Deferred student loans may be excluded from DTI calculations. |
| Consumers Credit Union | Up to $750,000 with no down payment | Not specified | IN, MI | None | Deferred student loans may be excluded from DTI calculations. |
| Frandsen Bank & Trust | Typically requires a 5% down payment | Not specified | MN, WI, ND | None | Deferred student loans may be excluded from DTI calculations. |
Source: Financial Residency
Case Study: Calculating Potential Savings
To illustrate the potential benefits, let’s consider a scenario where I, as a physician assistant, am purchasing a home valued at $500,000.
Conventional Loan:
- Down Payment: 20% of $500,000 = $100,000
- PMI: Required if the down payment is less than 20%, adding approximately 0.5% to 1% of the loan amount annually.
Physician Assistant Mortgage Loan:
- Down Payment: 0% to 5%, depending on the lender.
- PMI: Waived.
Assuming a 5% down payment with a physician assistant mortgage loan:
- Down Payment: 5% of $500,000 = $25,000
- PMI Savings: On a $475,000 loan (after down payment), avoiding PMI at 0.5% saves approximately $2,375 annually.
This example demonstrates a significant reduction in upfront costs and annual savings by utilizing a physician assistant mortgage loan.
Steps to Secure a Physician Assistant Mortgage Loan
Embarking on the journey to homeownership involves several key steps:
- Assess Your Financial Situation: Review your credit score, outstanding debts, and savings to determine your readiness.
- Research Lenders: Investigate lenders offering physician assistant mortgage programs, comparing terms and eligibility requirements.
- Pre-Qualification: Obtain pre-qualification to understand how much you can borrow and demonstrate seriousness to sellers.
- Gather Documentation: Prepare necessary documents, including proof of employment, income statements, and details of student loans.
- Consult Professionals: Engage with mortgage specialists familiar with physician loans to guide you through the process.
Conclusion
As a physician assistant, accessing mortgage loans tailored to our profession can significantly ease the path to homeownership. By leveraging these specialized programs, we can benefit from reduced down payments, waived PMI, and flexible loan terms. It’s crucial to conduct thorough research, compare lender offerings, and consult with financial professionals to make informed decisions aligned with our financial goals.
