Doctor Loans – Doctor Home Loans

 

Key Benefits Of A Doctor Loan

Beyond enjoying the prestige and immense job security, being a doctor is also advantageous when it comes to applying for a home loan. Physicians are known to have high salaries and a more stable job market compared to other professions, which make them lucrative and low-risk borrowers for banks and lenders. In fact, in recent years, lenders have been fighting to get their business. They recognise that doctors are some of the most financially stable professionals out there, thus, making them credit-worthy loan candidates. Even at the point of residency, when they haven’t reached their full earning potential yet, they could already have loan options.

Today, doctor loans have become more popular and have developed into a sweet and highly tempting deal. What are the advantages of a doctor loan? If you are a medical practitioner and considering borrowing some money for an investment in your practice or otherwise, here are some key benefits of a doctor loan.

1. Waived Lenders Mortgage Insurance

One of the main advantages of a doctor loan is not needing to pay Lenders Mortgage Insurance (LMI). It is a one-time, non-refundable, and non-transferrable premium that’s added to your loan. The LMI basically protects the bank against any losses in the event that you are unable to repay your loan. The figure is based on the amount you are borrowing and how much deposit you are willing to pay. You can avoid paying for LMI by meeting the 20% deposit requirement by lenders, meaning you can only borrow up to 80% of your property’s value. Higher deposits will mean lesser lenders’ mortgage insurance. But, if you are unable to meet the 20% down payment, you will be required to get an LMI.

Fortunately for you, since banks and lenders have high regard for a doctor’s ability to pay them back,  they can completely waive the LMI. There’s no need for you to make a guarantee, even if you are unable to arrive with the usual required down payment. This could possibly save you around $10,000 – $40,000, depending on the purchase price of the property you are buying.

2. Lower Deposit/Higher Loan To Value Ratio

The loan-to-value (LVR) ratio determines your risk to the lender as a borrower. It is calculated by dividing the loan amount by the lender-assessed value of the property. For example, your lender values the property at $500,000 and you can make a deposit of $100,000. So, you will need to borrow the remaining difference of $400,000. In this case, the LVR will be calculated as $400,000 (amount to be borrowed) divided by $500,000 (assessed property value). The LVR will be 80%. Typically, lenders consider an LVR of 80% or more to be risky and will require an added LMI. But, if you are a doctor, you will not have to worry about having to reach the 20% or more required deposit. Some lenders will even accept as low as a 10% deposit. You can also borrow higher LVR loans amounting to 90%, or even 100% depending on your lender, of the property price without any guarantee requirements.

3. Lower Interest Rates And Discounted Fees

Depending on the nature of your practice as a medical practitioner, lenders may offer lower interest rates and discounted fees. If you’re borrowing less than 80% of the property value, you will not need to pay LMI anyway so you can try to negotiate an interest rate discount instead.

And, since the interest rate is an important consideration for any home loan, be sure to check out the interest rates offered by different lenders. Also, check if you are eligible to avail of any more discounts. Furthermore, be sure to understand all the fees and other charges your loan might entail. This way, you can fully understand what your loan will cost you or ask for discounts that you might be qualified for.

Other Advantages

More than these key benefits of a doctor loan, there are many other lending advantages for medical professionals. You don’t need to present so many requirements. Your years of medical practice usually matters very little. And, loan releases are generally quicker. All you need are the necessary documents as proof of your practice. The M.D. on your name has earned you the lenders’ trust and respect.

Do you need a mortgage broker?

You don’t really need a mortgage broker to get a home loan if you are a medical professional. However, it will be wise for you to talk to a verified mortgage broker. They can give you expert advice and guide you through the process from start to finish. Mortgage brokers will also your home loan journey is smooth and seamless. They have all the information you need about home loan deals and the eligibility criteria of most banks and non-bank lenders. Plus, a mortgage broker also works around your timetable. No need for you to bother taking out time off your busy schedule. Still, the decision of whether or not you will work with a mortgage rests entirely up to you. Just try to learn as much as you can about securing financing or a loan for medical professionals.

Tips On Getting A Doctor Loan In Australia

Being a doctor is an honourable profession. You get to save lives and relieve the pain of sick and injured people. But, while you’re busy tending your patients, your personal commitments and plans often take the backseat. You might forget to have a good time and that you are more than your profession. You need to treat yourself from time to time and enjoy your life outside of your practice. Whether you are planning on making a big purchase or taking a holiday abroad, personal loans can help provide for your needs without putting stress on your finances.

Doctor loans in Australia are available to suit your specific needs. Lenders understand the difficulty of getting medical practitioners in going through the red tape. This is why getting personal loans for doctors in Australia is easier and with lesser requirements than getting a regular loan. Nevertheless, as the borrower, you still need to take some steps to ensure a loan approval. Here are some tips on getting personal loans for doctors Australia.

1. Secure Tenureship

Tenureship is an important factor that lenders will check when reviewing a doctor’s loan application. If you’ve been a resident in the same hospital for at least a year, there’s a higher probability of loan approval. The longer time you’ve worked in the same institution, the better chances you’ll have at getting a favourable offer. Lenders will not hesitate to approve loans from reputable and tenured doctors because they know they’ll surely get their money back.

2. Have A Good Credit History

Your credit history is another factor lenders will look into when considering your doctor’s loan application. They want to check your creditworthiness to know if they can trust you with making your repayments. If you’ve always paid all your debts and bills on time, you shouldn’t have a reason to worry. You might want to check your credit report before applying for a personal loan to see if everything is updated. However, having bad credit doesn’t mean you are no longer eligible to apply for the loan. Talk to a specialist or your trusted mortgage broker to learn about options that can help you obtain your doctor’s loan.

3. Compare Lenders

Banks and lending firms have different measures to check an applicant’s creditworthiness. So, try to compare the requirements of different lenders to see where your financial position can get the best loan offers. If you’re working with a broker, your broker can help you select the loans and lenders that best match your qualifications.

4. Check Your Debt To Income Ratio

Your debt to income ratio is critical in determining if you can afford your loan repayments. It is a gauge of what portion of your gross income is being allotted to pay for your outstanding debts such as auto loans and credit card obligations. If a huge fragment of your salary goes to paying off your debts, lenders will see you as a high-risk borrower. You need to have a debt-income ratio below 40% for improved chances of loan approval.

5. Pay Off Existing Debts

Having multiple debts, while applying for a new one, is a red flag for any lending institution. This shows lenders that you are not responsible when handling your money. Clear all your debts before applying for a new loan to have greater chances of loan approval. Focus on paying outstanding debts that are past due first and slowly work from there if needed. You might think that the new loan can help you pay your older debts, but it could only lead you to further financial stress.

The truth is personal loans for doctors Australia isn’t very difficult to secure. Generally, lenders find medical practitioners to be low-risk borrowers since being a doctor is one of the most stable professions. Nevertheless, keep these tips in mind to improve your chances of loan approval and make the process quick and seamless. And, when your personal loan gets approved, remember to pay your dues on time. Getting your finances in order will relieve you of future financial burdens. It also ensures that you can be approved for another loan. For more information about doctors loan, dentist loan, medical finance, or other types of personal loans, check out similar articles online or talk to your trusted mortgage broker.

Tips In Finding The Best Home Loan For Doctors In Australia

In Australia, it is very common for doctors to want to apply for a home loan, even early in their careers. If you are a doctor, finding a comfortable home is important to get the relaxation needed after a hectic day at work. However, because of your busy schedule, it’s almost impossible to find time to go through the red tape necessary to find the right home loan for you. You need to spare enough time and energy to get access to the best specialist products and rates tailored for medical professionals. And, if it’s your first time applying for a home loan, it can even get more challenging. To help you with this pursuit, here are some tips for finding the best home loan for doctors in Australia.

1. Check Your Qualifications

To be able to access the best home loans for medical professionals, you need to evaluate your financial standing. Doctors are mostly considered low-risk borrowers by banks and lenders because it’s one of the most stable professions in the world. This gives you a big chance of obtaining a home loan with good interest rates and shorter terms. However, there are other things a lender will look at when reviewing your loan application. This includes your credit history, current debts, insurance dues, taxes, and personal expenses. A lender will check how much of your income will go to paying debts and obligations, otherwise known as your debt-to-income (DTI) ratio. Having outstanding personal or student loans and other responsibilities may still get you a home loan, but it will limit the amount of money a lender will be willing to offer you.

If you don’t feel confident about your current financial standing, it’s best to postpone getting a home loan until you’ve cleared up some of your obligations. In a year or two, when you’ve paid off some loans and debts, you can finally get the new home you want and at better terms and interest rates.

2. Watch Out For Offers Unique To Doctors

After hiring a mortgage broker and passing them your financial documents, they’ll start looking for a home loan that will fit your preferences and needs. Since doctors are considered low-risk borrowers, you should be able to get any or all of the following offers:

Higher Loan to Value Ratio (LVR)

Loan to Value Ratio (LVR) refers to the size of your home loan vis-à-vis the value of the property you are going to buy. Lenders mostly allow home loans with 80% LVR or lesser. But, if you are a medical doctor, your lender could be agreeable to allowing a higher LVR for your home loan amounting to 90%, or even up to 100%, of the property price without any guarantee requirement.

Lenders Mortgage Insurance Waiver

Lenders commonly require borrowers to pay LMI (Lenders Mortgage Insurance) if they are borrowing more than 80% of the property value. This fee pays for an insurance policy that covers the bank for their losses if you do not repay your mortgage. However, since lenders see doctors as low-risk borrowers, your lender may offer a 100% waived LMI. This is a once-off saving when the loan is set up and will allow you to pay a lesser deposit for your new home.

Interest Rate Discount

Getting a lower interest rate on your home loan means you will have a lesser monthly repayment amount. Even a difference of .05% could save you thousands over the life of your home loan. The interest rates usually depend on your borrowing capacity and the amount you are borrowing. Because doctors are more likely to repay their loans, lenders are fighting to get your business. This will offer financing for doctors with the lowest interest rates. If you are working with a mortgage broker who has a special relationship with one of these lenders, they can even help you negotiate an even lower interest rate.

3. Find A Good Mortgage Broker

Directly approaching your trusted bank is not always a good idea for getting the best mortgage for doctors, especially if it’s your first time. If you want to get the best home loan, you need to research your options, gather your financial documents, do a price comparison, and consult multiple lenders. Working with a good mortgage broker that specialises in doctor loans will save you time and energy. They can take over all the tedious aspects of your home loan application and help you find financial institutions that can offer the best deals. Moreover, with an expert at your side, any issues will be addressed correctly, giving you a higher chance of loan approval.

To find a good mortgage broker, ask for recommendations from family or peers. You can also check out your options online through lender websites or a home loan expert review. Before you hire a mortgage broker for doctors, be sure to learn about their background and how well they’ve served other clients in the past. Moreover, make sure they have access to multiple lenders including those with competitive prices and maximum discounts.

Use these tips as a guide to finding the best home loan for doctors in Australia. And, when you do find the home loan you want, carefully review your agreement with your lender. Make sure you are aware of the payment schedule and the fees you have to make monthly payments for. A mortgage lender may help you with all the legwork, but it’s your job to manage your finances and make sure you’re not entering into a deal you are not ready to commit to.