Key Takeaways:
- California physician mortgage loans are available to doctors, dentists and other high-earning professionals who often have significant student loan debt.
- Physician mortgage lenders offer up to 100% financing with no private mortgage insurance (PMI)
- Eligible borrowers can access high loan limits, with some offering up to $3.5 million, without using a jumbo loan.
California is home to about 12% of the U.S. population, boasting a diverse landscape, endless entertainment and my personal favorite: The California Burrito. But it’s an expensive place to live.
Data provided by the California Association of Realtors shows the median home sales price for the entire state was $796,570 as of December 2021. However, homes in Southern California and the Bay Area sold for much more. For example, the median sales price for Orange County was $1.18 million. Whereas, the median price for the County of San Mateo was upwards of $2 million.
For many, homeownership in California is simply out of reach. However, doctors and dentists (and sometimes other high-earning professions) can take advantage of physician mortgage loan programs so you can buy your dream house much sooner than you hoped.
Read on to learn about physician mortgage loans in California.
How do California physician mortgage loans work?
A physician mortgage loan is a no- or low-money-down home loan solution available to doctors and dentists. Depending on the lender, other high-earning professionals (e.g. attorneys, pharmacists, veterinarians, etc.) might also be eligible.
One of the biggest perks is that physician mortgage loans have no private mortgage insurance requirement, regardless of how much you bring to the table for a down payment. This can save you hundreds of dollars of PMI payments every month compared to a conventional mortgage.
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Additionally, physician mortgage loan programs are designed to benefit professionals with large student debt balances at the beginning of their careers. You’ll benefit from more relaxed debt-to-income ratio (DTI) guidelines that treat student debt more favorably than a conventional loan.
These doctor mortgage loans also come with high loan limits, which helps enormously in an expensive state like California. Many physician mortgage lenders max out at $1 million to $2 million. But depending on the lender and your situation, you might be able to access even higher loan amounts up to $3.5 million.
7 Lenders that offer physician home loans in California
Here’s an overview of some of the physician home loans in California for doctors and dentists. We’ve noted if other high-earning professionals are included for each lender.
Be aware that most lenders restrict their physician home loan program to only include primary residences. However, a limited number of lenders extend their program to second or vacation homes. To clarify, this product isn’t available for real estate investment properties.
1. KeyBank
KeyBank’s customized medical professional loans provide up to 100% financing for eligible medical doctors and dentists. Loan amounts cap out at $3.5 million, which is much higher than most physician mortgage programs.
Loan options are available for purchase and cash-out refinances of owner-occupied primary residences and second homes.
To learn more, contact J Mansisidor (NMLS #354606) or call him at 757-926-0106.
2. Flagstar Bank
Flagstar Bank offers doctor mortgage loans for home purchases and refinancing in all 50 states for up to 100% financing with no PMI. They are the only lender in California that offers 100% financing on not only physician loans, but also professional loans.
Financing options include:
- 0% down for up to $1 million
- 5% down for up to $1.5 million
Flagstar Bank allows anyone with the following degrees to apply: medical residents, MD, DDS, DMD, OD, Doctor of Pharmacy, DPM, DO, RN, physician assistants, nurse practitioners, clinical nurse specialists, ATP pilots, CPA, attorneys, and veterinarians.
To be eligible, one must be 10 years or less from starting one’s career. There is no 30 year fixed rate option.
They serve H-1B visas and/or green card holders.
To be approved for 5% down, you must have at least a credit score of 700. To be approved for 0% down, you must have at least a credit score of 720.
If you’re a 1099 worker, you need to supply documentation of at least two years of income.
For more information, email Tish.
3. Truist
The Truist doctor mortgage loan is available to eligible practicing physicians and licensed residents, interns and fellows. Their program lets you close up to 90 days before an employment start date if you have a job offer in-hand.
Residents, interns and fellows in an MD, DO or DPM program have access to loan amounts up to $750,000 with no money down. Loan options for doctors and dentists (MD, DO, DPM, DDS and DMD designations) with fewer than 10 years since completion of training include:
- 0% down for up to $1 million.
- 5% down for up to $1.5 million.
- 10.01% down for up to $2 million.
For doctors and dentists with 10 to 15 years post-training experience, 89.99% financing is available for up to $1.5 million.
Doctors with student loans can get a break, too — if your student loan is deferred for at least 12 months at the time of closing, your payment isn’t counted in your DTI.
For more information, email Matt Albert or call him at 336-439-3560.
4. U.S. Bank
U.S. Bank offers business and personal financial services for healthcare professionals, including tailored home loans for medical physicians, doctors of osteopathy (DO), residents and fellows.
Loan options include:
- 5% down for up to $1 million
- 10% down for up to $1.5 million
- 15% down for up to $2 million
If your student loans are deferred, U.S. Bank will use 2% of your student loan balance when calculating your DTI ratio.
This product isn’t advertised online, so you’ll need to reach out directly for specific eligibility requirements and loan terms.
For more information, email Jonathan Brozek or call him at 916-602-4080.
5. S&T Bank
S&T Bank’s physician mortgage is available to many medical professionals, including residents, fellows, doctors of medicine, dental science, optometry, osteopathy and doctors of veterinary medicine.
But that isn’t all — if you’re an attorney or have a Ph.D. in a non-medical profession, you can also qualify for this generous home loan program.
Loan options include:
- Up to 95% financing
- 5% down with no maximum loan amount
- 10, 15, 20 and 30 year fixed-rate options
- 5 and 7 year adjustable-rate options
You also have the option of a cash out refinance if you already own a home and want to tap into the equity. You can get up to 80% loan-to-value (LTV) and there’s no cap on the cash out limit.
A 700 or higher FICO score is recommended when using S&T Bank.
Want to know more? Email Mike Wagner.
6. BMO Harris
With BMO Harris, you can get an affordable home loan with no PMI requirement and flexible debt-to-income underwriting options.
Licensed medical doctors with MD, DDS, DMD or DO designation can qualify even if you have student loan debt. Plus, the program is open if are starting residency soon and have an employment contract with a start date within 90 days of closing.
Financing options include:
- 5% down for up to $1.5 million
- 10% down for up to $2 million
Contact: Patrick O’Malley. Email Patrick or call him at 623-283-1433.
7. Citizens Bank
Citizens Bank offers personalized plans and services for healthcare professionals. Its doctor loan mortgage program provides up to 95% financing for doctors and dentists for purchases and limited cash-out refinances of a primary home.
Loan options include:
- Up to 95% financing for up to $850,000.
- 89% financing for up to $1 million.
- 85% financing for up to $1.5 million.
Eligible borrowers include licensed DO, Doctors of Medicine (MD), Doctors of Dental Surgery (DDS) and Doctors of Dental Medicine (DMD) who’ve completed residency within the last 10 years. Additionally, current medical professional residents, fellows and interns might qualify.
Related: Calculate payments with our Physician Mortgage Loan Calculator
Is a California physician home loan right for you?
Physician mortgage loans have a lot of perks with very little downside. If you’re eligible, it’s worth exploring your doctor home loan options with different lenders, along with other mortgage options (e.g. FHA loan or VA loan).
But be diligent in your home buying efforts. You’ll likely qualify for a much higher loan amount than you’re expecting, based on the flexible DTI and income requirements of this mortgage type. Just because you qualify for a larger mortgage on paper doesn’t mean you should tank your finances for a more expensive property.
If you can’t safely afford a larger physician mortgage payment, keep your eyes focused on the homes you can realistically afford.
