What you need to know:
- Physicians in Hawaii could get 0% down payment or low down payment options plus no private mortgage insurance (PMI) with a doctor mortgage.
- Receive up to 100% financing for loans of $1 million or more as a doctor, dentist, nurse or other qualifying health professional.
- Take advantage of generous terms and underwriting options even with high amounts of student loan debt.
With a population of just over 1.4 million residents, Hawaii is considered the Aloha State for good reason. The state is known for its beautiful beaches, clean white shores and its vacation lifestyle all year long. If you’re a doctor or dentist hoping to buy a home in Hawaii, you’ll find a special home loan program just for you.
The physician mortgage loan in Hawaii allows medical professionals to take advantage of exclusive perks and benefits unique to their financial situation. Yes, even if you have high amounts of student loan debt from graduate school, you could still get attractive perks like 0% down and no PMI on your home loan.
Read on to learn more about what a physician loan in Hawaii includes and what it could mean for your dreams of homeownership.
What is a Hawaii physician mortgage loan?
In Hawaii, a physician home mortgage is a loan program specifically designed for medical professionals such as dentists, nurses, veterinarians and doctors. For this reason, it’s often called a doctor mortgage.
But as mentioned, these types of loans aren’t just for doctors. Anyone who has MD, DO, DDS, DP, DPM, OD, DVM, DC or PharmD designation can quality, too. Typically professionals in the medical field have high income and high debt, due to large amounts of student loans. Luckily, this is not a deterrent to qualifying for a physician mortgage.
Here are three of the primary benefits of a physician mortgage in Hawaii.
Zero down payment
Usually with a conventional mortgage borrowers need to bring at least 20% of the home’s cost to the table during closing. Eliminating this could mean savings of thousands or even hundreds of thousands of dollars when purchasing a home.
But this is not the case with a physician mortgage! As a health professional, you could qualify for 0% down with a doctor mortgage, depending on the total cost of the home.
No private mortgage insurance (PMI)
A huge per-month savings with a doctor mortgage is the fact that private mortgage insurance (or PMI for short) is not required. According to FreddieMac, the average cost of PMI is between $30 to 70 per month for every $100,000 borrowed.
Using this average, if a home costs $1.5 million you would pay between $450 and 1,050 extra per month in PMI with a conventional mortgage. However, a physician mortgage in Hawaii does not charge PMI, therefore saving you hundreds or even thousands of dollars each month.
Student loan debt friendly
Physician mortgage loan programs expect their borrowers to have excessive student loan debt from medical school. But thanks to generous underwriting guidelines, the terms are usually flexible when calculating the debt-to-income ratio (DTI).
In some cases, lenders use the actual monthly payment from a federal repayment plan, such as Income-Based Repayment (IBR), Pay As You Earn (PAYE) or Revised Pay As You Earn (REPAYE).
There are also allowances for new physicians and those in residency. Many lenders allow attendings, residents, fellows and even interns to use an employment contract. Just be sure the start date is between 60 and 90 days prior to closing.
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5 Top physician mortgage lenders in Hawaii
Here are four of the top lenders offering physician loans in Hawaii, each with its own specific set of terms and perks. Review the details of each mortgage loan amount offered and reach out to the loan officers listed for more information.
We recommend getting two to three quotes to compare lenders and find the best deal possible.
1. BMO Harris
With BMO Harris, you can get an affordable home loan with no PMI requirement and flexible debt-to-income underwriting options.
As a licensed medical doctor with MD, DDS, DMD or DO designation, you could qualify even if you have student loan debt, 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
2. KeyBank Mortgage
KeyBank’s Medical Professional Loans Program offers one of the highest loan limits in the physician mortgage space with loans up to $3.5 million. And unlike other banks that limit their program to new physicians, you can apply for a physician mortgage with KeyBank no matter how long you’ve been in practice.
KeyBank’s doctor and dentist program extends its eligibility to those who are a resident, fellow, or attending with an MD, DO, DPM, or DMD. Those who can provide a signed employment contract can close 90 days prior to his or her start date of employment.
Borrowers can be granted 100% financing on a conventional mortgage.
KeyBank has 30, 25, 20, 15, and 10 year fixed rate options, as well as adjustable rate options of 10/6 ARM, 7/6 ARM, and 5/6 ARM.
Maximum cash out available is $1,000,000.
3. 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.
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. The only mortgage type available is adjusted-rate mortgages (ARMs).
H-1B visas and/or green card holders are eligible.
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.
Contact Tish Kumar. Email Tish.
4. U.S. Bank
The professional mortgage options at U.S. Bank are available for medical physicians, including residents, fellows, and doctors of osteopathy (DO). Dentists and nurses are not eligible at this time.
Compared to some of the other lenders on this list, U.S. Bank has slightly higher down payment requirements. But their customer service with medical personnel is highly rated.
Physicians with a credit score of 710 or higher can receive 95% financing for up to $548,250 (or up to $822,375 in select counties).
Financing options include:
- 5% down for up to $1 million
- 10% down for up to $1.5 million
- 15% down for up to $2 million
5. S&T Bank
With S&T Bank’s Professional Mortgage Program, physicians and other eligible professionals can get a loan for 5% down with no required maximum loan amount. No restrictions apply on a physician’s age. Newly self-employed (1099 independent contractor) physicians are allowed with a provided employment agreement.
To be eligible, one must be a medical resident, medical fellow, attorney, or hold a MD, DDS, DMD, DO, DVM, or PhD in a non-medical science. H-1B visas and/or green card holders can be served. VA loans are also available; although, you will find better deals with their Professional Mortgage Program, by comparison.
A 700 or higher FICO score is recommended when using S&T Bank.
Cash out refinances are limited to 80% LTV (Loan-to-Value) and no cash out limit.
30, 20, 15, and 10 year fixed rate options and 5 and 7 year ARM’s options are available.
Contact: Mike Wagner. Email Mike.
If you want even more choices for doctor mortgage loans in Hawaii, check out our full list of lenders in all 50 states.
Is a doctor mortgage in Hawaii right for you?
The average home value in Hawaii is nearly $870,00 with estimates climbing more than 22% over the past year. But that doesn’t stop the 3,700 practicing physicians from calling Hawaii home. If owning a home in the gorgeous state of Hawaii is your dream, you can make it happen — thanks to a physician loan mortgage.
If you’re concerned about the risk of getting such a high mortgage loan along with your student debt, keep in mind that these programs are designed for this! Think of your career in the health field as a pro, not a con. Plus, depending on your income, the mortgage interest paid on your home could be used as a tax deduction.
Lastly, remember that making mortgage payments on a doctor loan is a long-term investment for you and your family. That’s why we recommend getting started by filling out the form below to get in touch with the top mortgage lenders in Hawaii.