Can You Buy a Home With Medical School Debt?
Of course you can! There are quite a few loan programs out there for new physicians who have incurred large amounts of student debt while getting their undergrad and post grad degrees. Student loan debt is high for many people but medical doctors often have an overwhelming amount of loans that might prevent them from purchasing a home for quite a while without these special programs. According to The Association of American Medical Colleges, eighty-four percent of medical school grads have student loan debt and the median amount is $180,000. This is a staggering number at its face value but with a few years of being in practice, the debt can easily be managed or even paid in full. Major home lending institutions understand this fact and have implemented special mortgage programs to help these new physicians get started with home ownership.
Many of these former medical students have gone through nearly a decade of education and training. They've lived in dorms, small apartments and rooms to be able to survive. Upon graduation they really have a desire to put down roots and buy a home to call their own. They've had a steady diet of ramen noodles for a while and now feel entitled (rightfully so) to make the leap into real adult life, food and housing.
Bank of America has their Doctor Loan program that offers medical residents, dentists and licensed practicing doctors a great option for qualifying for and obtaining a mortgage. Bank of America has an overall strategy of building relationships with high earning physicians to gain their business for mortgages, investments and credit cards. Those who meet the above criteria can obtain a mortgage with as little as 5% down on a loan amount of up to $850,000. The employment start date can be up to 60 days after closing on the property. Student loan debt IS NOT INCLDED when they calculate the total debts for loan qualifying purposes. There are a range of fixed and adjustable rate option loans. For info on this program contact Jason Konopaske, NMLS ID:999021, at Bank of America.
For those who are currently still in medical or dental school, the key here is to try as hard as possible to live on a cash basis while in school. Do not take out big loans and then live off of credit cards on top of that. Credit card and other installment debt WILL count against you when trying to qualify for a mortgage. Back to the ramen noodles and Chipotle gift cards sent to you by your mom! Living frugally during school will allow you to have a good debt to income ratio when it comes to buying a home.
Recent medical school graduates who have been hired into a residency program in the Phoenix or Scottsdale area will want to contact Shawn Jardine to start the house hunting process. There are lots of great neighborhoods near our many large hospitals.
