For medical professionals, finding the right loan is not as difficult as most people believe. The paperwork is also not as daunting as you think. The toughest part is choosing the right house for you and your family. You might have to work with an online real estate service or hire a private agent to find your dream home.
We are sure that you will find the right home loan since doctors are attractive borrowers. Most banks and other financial institutions do not turn medical professionals away, even when they are fresh out of residency. Most physicians have a promising career ahead of them, and that gives the lenders a form of assurance. Therefore, being a doctor may take a lot of hard work, but you gain the right to enjoy a few perks too.
Why should physicians consider special mortgage loans for doctors?
When a doctor opts for a mortgage loan, he does not have to pay the PMI, and he can choose to skip the down payment as well. Most experts recommend at least 20% as down payment to keep the APRs manageable. You should look for competitive rates. The interest rates are usually about 1% higher than the market rate for traditional home loans, but you should think of it as the price for the convenience. It might take someone over a month to get a home loan, but physician home loans can take lesser than two weeks to process. Visit the Regions Bank doctor loan site to learn more about expediting the application.
Why should you never go for loans without the down payment?
While researching your loan options, you will come across banks that are ready to offer 100% financing with zero payment at closing. It might sound like an excellent offer to the cash-poor doctor, but it is an old trick you need to know! These financial institutions roll these expenses into the mortgage, and you pay the price unknowingly. When you make a down payment, it reduces the interest rate by x%. However, when you refrain from paying it, the interest rate adds up by x%. As a result, you end up paying x% more than the standard market rate on your home mortgage loan. Without making a down payment you will always end up paying extra, but you will not feel it since the banks spread the amount over the next 20 or 30 years (your repayment period).
When you are buying a house, speak with your attorney and a financial advisor. Talking with an experienced real estate agent will also help you understand the intricacies of the interest rates, annual payment rates and additional costs of the loan. Just because a bank is ready to offer 100% financing, that does not make it the best option for you. Sometimes, paying a couple of hundred dollars beforehand can save you thousands of dollars in the long run. Always double check your interest rates and always believe that you are not ready unless you have enough savings to pay the closing costs of the house. If you can, get an idea of the real estate prices in the neighborhood and find out the loan costs before you can put in a proposition at the bank for better rates.