Question 1

What is a physician mortgage loan?

Accepted Answer

A physician mortgage (also called a doctor loan) is a specialized mortgage product offered by select lenders to MDs, DOs, dentists, and sometimes residents and fellows. Key advantages: no PMI even with less than 20% down, high debt-to-income tolerance (student loans often excluded or IBR-counted), and approval despite short employment history.

Question 2

How much can I save by avoiding PMI with a physician loan?

Accepted Answer

PMI typically costs 0.5%–1.5% of the loan amount per year. On a $500,000 loan, that's $208–$625/month in PMI alone. Over the first 7–10 years before you'd reach 20% equity, a physician loan can save $15,000–$45,000 in PMI payments depending on loan size and rate.

Question 3

Do physician loans have higher interest rates?

Accepted Answer

Physician loans typically carry rates 0.1%–0.5% higher than conventional loans. However, eliminating PMI (0.5%–1.5%/year) usually more than offsets the rate premium, resulting in lower total monthly costs. This calculator shows the real comparison including both factors.

Question 4

Who qualifies for a physician mortgage?

Accepted Answer

Eligibility varies by lender, but typically includes: MDs, DOs, DDSs, DMDs, and sometimes PhDs, PharmDs, PAs, and NPs. Many lenders accept residents and fellows with a signed employment contract. Minimum credit scores are typically 700+. Most loans go up to $1M–$2M.

Question 5

What is PMI and when can I remove it?

Accepted Answer

Private Mortgage Insurance (PMI) is required on conventional loans when your down payment is less than 20%. It protects the lender, not you. By law (Homeowners Protection Act), lenders must cancel PMI when your loan balance reaches 80% of the original home value. Physician loans skip PMI entirely regardless of down payment.

Question 6

Should residents and fellows get physician mortgages?

Accepted Answer

Yes, if buying in a city where you'll stay post-residency. Physician loans accept signed employment offers in lieu of W-2 history. However, buying during residency adds financial risk — calculate carefully. Many residents do better renting until attending income begins.

Question 7

Can I refinance a physician loan into a conventional loan?

Accepted Answer

Yes. Once you have 20%+ equity, refinancing to a conventional loan often gets you a lower rate. The physician loan gets you into the home without PMI; a refinance at 20% equity locks in long-term savings. Use this calculator to model both scenarios.

Question 8

What down payment do physician loans require?

Accepted Answer

Most physician loans allow 0%–10% down with no PMI. Some lenders offer 0% down up to $750K and 5% down up to $1.5M. Putting more down reduces your loan balance and interest, but preserves cash during the high-expense early career phase.

Question 9

How does the physician loan calculation work?

Accepted Answer

This calculator uses the standard amortization formula: M = P × [r(1+r)^n] / [(1+r)^n-1], where P is principal, r is monthly rate, and n is number of payments. PMI is estimated at your selected rate applied to the loan balance. The physician loan calculation assumes no PMI and applies any rate premium you specify.

Physician Mortgage Calculator

10-Year Total Cost Comparison

What is a Physician Mortgage?