A physician mortgage is a loan a bank keeps on its own books instead of selling, which lets it set its own rules for doctors. In practice that usually means little or no down payment, no mortgage insurance, permission to close on a signed employment contract before your first paycheck, and gentler treatment of medical school debt. Those four things are the entire product.
It is not a subsidy or a special government program. It is a bank making a calculated bet that a physician early in a career is a very safe borrower who happens to look terrible by the standard rules a lender uses to approve a loan.
Why This Loan Exists at All
Picture a resident finishing training. She has an employment contract starting in July at $280,000. She also has $215,000 in student loans, which is the median for the graduating class of 2025, and almost no savings, because she has been earning a resident salary for four years (AAMC, October 2025).
On a conventional application she fails on three counts at once. No income yet, because the job has not started. No down payment. And a debt load that blows up her debt-to-income ratio.
Banks noticed a long time ago that this borrower almost never defaults. Physician loans are the product built around that observation.
How a Physician Loan Compares
| Physician loan | Conventional | FHA | VA | |
|---|---|---|---|---|
| Minimum down payment | Often 0% | 3% to 5% | 3.5% at 580 credit | 0% |
| Mortgage insurance | Usually none | Private mortgage insurance under 20% down | Required, often for the life of the loan | None, but a funding fee applies |
| Close before job starts | Commonly yes | Rarely | Rarely | Rarely |
| Student loan treatment | Often favorable or excluded | Rule-based, varies | 0.5% of balance if payment is $0 | Rule-based |
| Who can use it | Specific degrees only | Anyone who qualifies | Anyone who qualifies | Service members and veterans |
Sources: FHA Mortgagee Letter 2021-13, VA funding fee schedule, Fannie Mae Selling Guide B3-6-05.
Who Qualifies
Eligibility is set degree by degree, and every lender draws the line somewhere different. There is no industry standard.
Commonly accepted: MD and DO across essentially every program. DDS and DMD at most. DVM at some. DPM and OD at fewer. CRNA and DNAP at a small number.
The lists differ. One program may name MD, DO, DDS, DMD and DVM while leaving off DPM and OD. Another names MD, DO, the dental degrees, residents, fellows and nurse anesthesia credentials. Neither list is wrong. They are simply different products, which is why one bank saying no tells you nothing about the next one.
If you hold anything other than an MD or DO, confirm your degree qualifies before anything else. We cover each one separately: dentists, podiatrists, optometrists and veterinarians.
How Much You Can Borrow
Physician programs use tiers. The down payment steps up as the loan gets larger. A common pattern is zero down up to around a million dollars, 5% down into the mid one millions, and just over 10% down at the top of the range.
For scale, the 2026 conforming loan limit on a one-unit property is $832,750, and $1,249,125 in high-cost counties (FHFA, November 25, 2025). The median existing home in the United States sold for $434,100 in July 2026 (NAR, August 11, 2026).
So for most buyers, the zero-down tier alone covers far more house than they need. The tiers matter mainly if you are buying in an expensive market or at the top of your budget.
The Student Loan Advantage, Explained Properly
This is the real engine of the product, and it is worth understanding rather than taking on faith.
Under agency rules, if your student loan payment shows as $0 on your credit report, FHA and Freddie Mac count 0.5% of your balance anyway. Fannie Mae will accept a documented $0 income-driven payment, but counts deferred loans at 1% of the balance. On $215,000 of debt, that is $1,075 or $2,150 a month dropped into your ratio.
Physician programs sit outside those rulebooks because the bank keeps the loan on its own books. Some publish a rule that student loans deferred well past closing are not counted in your ratio at all.
Removing $2,150 a month from your debt side is worth several hundred thousand dollars of borrowing capacity. That is usually a bigger deal than the down payment. The full breakdown is in how student loans are counted on a mortgage application.
Closing Before Your First Paycheck
Most lenders want to see pay stubs. Physician programs will often accept a signed employment contract instead, which lets you close before you start.
Programs commonly publish a window running from about 60 days out to 150 days before you relocate or change jobs, with 90 days the most common, and 90 or more days before residency begins, with a signed contract and a letter from the employer.
The contract requirements and the one condition that derails the most purchases are covered in buying before your job starts.
What You Give Up
We would rather you hear this from us than find out later.
The rate may be adjustable. Some programs publish only adjustable rate terms, in 3, 5, 7, 10 and 15-year structures. If you assumed a 30-year fixed, that is a different loan. Ask what it adjusts to, how often, and what the caps are.
Nobody publishes the rate premium. You will read that physician loans cost more, and also that they cost less. No regulator, research institution or industry data source publishes a figure. We looked. Get a written quote from a physician program and a conventional lender on the same day and compare the actual payments.
Zero down means zero equity. If prices dip and you need to move, you can owe more than the house is worth. Residency and fellowship are short. Think honestly about how long you will be there.
Approval is not affordability. A program that will lend you $1,000,000 with nothing down is not telling you that you should borrow it. See how much house a doctor can actually afford.
When a Conventional Loan Is the Better Choice
Sometimes it plainly is, and a good lender will tell you so.
If you have 20% to put down, a conventional loan carries no mortgage insurance either, and you skip the physician program entirely. If your student loans are already in active repayment with a modest documented payment, the DTI advantage mostly disappears. If you want a 30-year fixed and your physician lender only offers ARMs, that is a real reason to look elsewhere.
And if you do end up with PMI on a conventional loan, it is not permanent. You can request cancellation at 80% of the original value, and it terminates automatically at 78%, under the Homeowners Protection Act (12 U.S.C. 4902). It also ends automatically once you are halfway through the loan term, as long as you are current (CFPB, August 2026).
We put the two side by side, including the loan size threshold most people miss, in physician mortgage versus conventional.
What It Costs to Close
Even with nothing down, you still need cash. Closing costs typically run 2% to 5% of the purchase price (Freddie Mac, February 2026). On a $500,000 house that is $10,000 to $25,000.
Some programs let the seller contribute toward your closing costs, commonly up to 3% for residents. Ask about that early, because it can be the difference between closing this year and next.
Full line by line breakdown, and three ways to bring less cash, in closing costs and cash to close.
Where to Check Rates
Market averages move every week, so any number printed on a page like this one is out of date by the time you read it. The Freddie Mac Primary Mortgage Market Survey publishes the 30-year and 15-year averages weekly and is the cleanest free benchmark to check.
Physician loan pricing is set lender by lender and is not included in that survey, so treat it as a benchmark for the wider market rather than a quote you can expect.
For how physician loan pricing is actually built and which levers move your number, see how doctor loan pricing works.
What Skipping Mortgage Insurance Is Worth
The table above says a physician loan usually carries no mortgage insurance. That line is worth putting a dollar figure on, because it is the single largest cash advantage these programs offer.
Private mortgage insurance, usually shortened to PMI, is what a conventional lender adds when you put down less than 20 percent. It protects the lender if you stop paying and it does nothing for you. It runs roughly 0.46 percent to 1.50 percent of the loan every year (Urban Institute). On a $700,000 loan that is $3,220 to $10,500 a year, which is $268 to $875 a month, and you carry it until your balance reaches 78 percent of what you paid for the house.
At 5 percent down on a typical purchase that adds up to tens of thousands of dollars over the life of the charge. You can put your own numbers against it in our physician mortgage payment calculator, which shows the same house on both loans side by side.
This is also why a physician loan priced slightly above a conventional loan can still be the cheaper monthly payment. Compare the full payment, not the rate.
The Nine Questions to Ask Any Physician Mortgage Lender
Programs differ more than their marketing suggests, and the differences are rarely on the website. These are the nine questions that actually determine what you can borrow. Send all nine in one email and keep the reply.
- How do you count my student loans if they are deferred or on an income-driven plan? This is the single biggest variable. The same balance can count as $0, as your real payment, as 0.5 percent of the balance, or as 1 percent. On a $215,000 balance that is a swing of more than $2,000 a month in what counts against you.
- What is the largest loan I can get with nothing down, and what changes at the next tier? Tier boundaries are sharp. A purchase $50,000 higher can mean $100,000 of cash you did not plan for.
- What is your minimum credit score, and what does a lower score cost me? At most programs the score does not decide whether you qualify. It decides which tier you land in.
- Is the rate fixed or adjustable, and if adjustable, fixed for how many years? Many of these loans are adjustable rate mortgages, meaning the rate holds for a set period and can then move.
- How many days before my start date can I close? The published range across programs runs from about 60 days to 150 days, with 90 the most common. If your contract starts further out, ask before you make an offer.
- Do you lend in my state? Several of these programs are regional. This question kills more applications than any other, and it takes ten seconds to answer.
- Is my degree on your published eligibility list? MD and DO are always there. DDS and DMD almost always. DPM, DVM and OD vary a great deal, and an unlisted degree is a decline no matter how strong the rest of your situation is.
- How many years past training can I be and still qualify? Most programs set a window of roughly ten years. A few have no cutoff. At least one keeps you eligible indefinitely but asks for a larger down payment past ten years.
- What is your maximum debt-to-income ratio, and does it change with my down payment? Your debt-to-income ratio is your total monthly debts divided by your income before taxes. Some programs raise the ceiling when you put more down.
If a loan officer cannot answer all nine, that is information too. We ask these questions of every program we work with so you do not have to.
Common Questions About Physician Mortgage Loans
What Is a Physician Mortgage Loan?
It is a mortgage a bank keeps on its own books instead of selling to an investor, which lets the bank write its own rules. In practice that means little or no down payment, no private mortgage insurance, gentler treatment of student debt, and the ability to qualify on a signed employment contract before you have started the job.
Do You Have to Be a Physician?
No. MD and DO are on every list, and DDS and DMD are on nearly all of them. DPM, DVM and OD appear on a shorter set of programs, and a few include pharmacists or nurse anesthetists. Since an unlisted degree is an automatic decline, checking the list is the first step rather than the last. We have separate pages for MD and DO, DDS and DMD, DPM, OD and DVM.
Can You Really Buy With Nothing Down?
Yes, within limits. Programs commonly finance the full purchase price up to a million dollars or more, then ask for a down payment above that. The limit is not your eligibility, it is the monthly payment your income can carry once your student loan is counted.
Is a Physician Loan Actually a Good Idea?
It depends on when you are asking. Finishing training with a signed contract and little savings, it is usually the best tool available and often the only one that works. Five years into practice with 20 percent saved and the loans paid off, an ordinary loan may serve you better, and you should compare both seriously.
What Credit Score Do You Need?
Most programs start somewhere between 680 and 720. At many of them the score sets which tier you qualify for rather than whether you qualify at all, so twenty points can be worth several hundred thousand dollars of borrowing capacity.
Can Residents and Fellows Qualify?
Yes. Residents and fellows are named directly in nearly every program, and training pay is accepted. The constraint is the payment a resident’s income can support, not eligibility. There is more in our guide for residents and fellows.
Are Physician Loan Rates Higher?
Often slightly, though no bank publishes the number because pricing is set per borrower. Compare the full monthly payment against a conventional quote on the same day, because avoiding mortgage insurance frequently more than offsets a higher rate.
How Long After Training Can You Use One?
Usually about ten years past residency or fellowship, though this is the rule that varies most. Some programs have no cutoff at all, and at least one keeps you eligible but requires a larger down payment once you are more than ten years out. If you have been told you aged out, that was one program’s rule rather than the whole category’s.
Deciding What to Do Next
You do not need to become a mortgage expert. You need to know your degree qualifies, what your down payment is at your target price, how your student loans will be counted, and whether the rate is fixed. Four answers, in writing.
If you would rather not chase them down, that is what we do. Tell us your situation and we will match you with a lender whose published rules fit. It takes about two minutes and costs you nothing.
Next: what it takes to qualify, how the zero down tier really works, or whether to buy during residency at all.
Last verified September 9, 2026. Rates, loan limits and lender terms change. We recheck this page monthly.