What you need to know:
- Physicians less than 10 years out of residency might qualify for a TD Bank Medical Professional Mortgage.
- TD Bank Medical Professional Mortgages can be available for higher loan amounts and lower down payments, with no private mortgage insurance (PMI).
- Mortgages for physicians through TD Bank help medical professionals who are early in their career with flexible debt-to-income (DTI) requirements.
Physicians, surgeons, dentists, residents and fellows might be eligible for a home mortgage through TD Bank. Its Medical Professional Mortgage offers features that specifically benefit borrowers in the medical field who are relatively early in their careers.
TD Bank physician mortgage: What to know
TD Bank, the U.S. segment of Toronto-Dominion Bank in Canada, has branches in 15 states plus the District of Columbia. The bank offers a wide range of financial services for personal, business, commercial, and investment needs.
Some of the key benefits of a TD Bank physician mortgage include no need to pay private mortgage insurance, the ability to secure larger loans with a smaller (or no) down payment, and flexible loan approval guidelines that allow for a higher DTI ratio.
TD Bank doctor mortgages offer a competitive financing model that enables physicians, physician residents, dental residents and fellows to obtain large loans with little or no money down. Here are the loan specifics:
- Up to $750,000 purchase price = up to 100% financing available
- Up to $1.25 million purchase price = up to 95% financing available
- Up to $1.5 million purchase price = up to 89.9% financing available
Not having to pay for PMI could result in a significantly lower monthly mortgage payment long before you reach 20% equity in your home. This frees up funds for additional student loan payments or retirement savings.
Benefits of a TD Bank Medical Professionals Mortgage
Let’s talk about some of the primary features physicians may find appealing about TD Bank’s mortgages. These are the top advantages to a physician mortgage with TD Bank:
- Physicians and residents might get approved for a mortgage with zero money down or a very low down payment.
- TD Bank Physician mortgages save you money because down payments below 20% don’t require PMI.
- Residents, doctors, and dentists may qualify for a TD Bank mortgage despite a high DTI ratio. This is helpful if you have medical school debt.
- Qualified applicants might get a physician mortgage based on a new employment contract, enabling them to get settled upon relocation before beginning a new job.
Disadvantage of a TD Bank physician mortgage loan
The TD Bank mortgage for medical professionals isn’t an ideal option for everyone, since the bank only operates in 15 states and D.C. The property you purchase with a TD physician mortgage must be located in a state where the bank has branches.
These states are:
- New Hampshire
- New Jersey
- New York
- North Carolina
- Rhode Island
- South Carolina
- District of Columbia
If you plan on purchasing a property outside of these few states, you likely won’t get approved for a TD Bank physician mortgage loan.
TD Bank mortgage loan application process
To apply for a TD Bank Medical Professional Mortgage, you’ll need to meet additional qualifications aside from purchasing a home in a TD Bank-serviced state. Below is a list of basic qualifications to review.
Qualifications for TD’s physician mortgage loans:
- Must be a qualified physician. This requirement includes a practicing physician (MD, DO, DPM), dentist (DDS, DMD), or oral surgeon designation.
- Licensed medical/dental resident or fellow. Also, applicants must be less than 10 years past residency.
- Be employed. If you’re self-employed, you’ll need to provide at least two years of tax return documentation.
- Have a TD Bank Checking Account. Accounts must be in good standing; the lender doesn’t specify a required checking account age requirement.
- Eligible property. Must be used as a primary residence (not vacation home) and be an eligible property type (e.g. single-family residences, condominiums, co-ops (but check with your local branch; only available in specific markets), or properties in a planned unit development).
As is typical in the mortgage lending process, lenders consider the applicant’s debt-to-income ratio. This is the amount of your debt payments divided by your gross income. A TD Bank doctor mortgage requires a DTI of 43%.
When you’re preparing your application, get documentation from your student loan servicer showing your total student loan debt, payment amounts and any other pertinent information, such as if you’re in deferment or forbearance. TD Bank will need to confirm your student loan payments before proceeding with a home loan.
TD Bank doctor mortgages can be offered on the basis of a new offer of employment. This can simplify the process if you need to relocate and don’t have pay stubs for your new position yet.
You’ll need to get the employment contract in writing, and it must specify your new income. In addition, your employment must begin within 90 days of the home closing purchase date. TD Bank physician mortgages must still go through approval from the underwriters, but meeting these requirements should make the process smoother.
Refinancing an existing home
You also have the option of refinancing your current primary residence, if you’d like to get better loan terms to save you money. You might have a choice between fixed rates or adjustable rates on your loan with TD Bank.
Although a fixed-rate mortgage offers more certainty for your monthly payment amount, an adjustable-rate mortgage can be useful in some circumstances. For instance, if you know you might relocate in a relatively short period, such as five to 10 years, an adjustable interest rate might save you money.
Getting a physician mortgage through TD Bank
In short, a TD Bank physician mortgage can be a terrific option for certain medical professionals who are building their careers. Particularly, if your income isn’t where you want it just yet, and securing traditional mortgage financing is challenging.
TD Bank is one lender that offers favorable mortgage options for practicing physician borrowers to help them get into a home earlier than might otherwise be possible.