Zero down physician loans are real, and the published ceilings are higher than most people expect. Programs commonly publish 100% financing up to around a million dollars, with no down payment required. These are ordinary features of the product, not promotions.
What zero down does not mean is zero cash. You will still need money at closing, and you will still need reserves, meaning money left in the bank afterward. This page explains exactly what the tier covers, what it costs you in equity, and when putting something down is the better decision.
Run your own numbers: our physician mortgage payment calculator shows what the monthly payment would be, and what the same house would cost on a conventional loan once mortgage insurance is added in.
Which Lenders Publish a Zero Down Tier
| Financing | Down payment | Typical published ceiling |
|---|---|---|
| 100% | $0 | Around $1,000,000 |
| 95% | 5% | Into the mid $1,000,000s |
| About 90% | Just over 10% | $2,000,000 and up |
To put a $1,000,000 zero-down ceiling in perspective, the 2026 conforming loan limit for a one-unit property is $832,750, and the median existing home in the United States sold for $434,100 in July 2026 (FHFA, NAR). For most buyers, the zero-down tier covers far more house than they will ever want.
One caveat worth knowing. Programs commonly note that which loan-to-value option you get depends on your FICO score. The top of a tier is not automatic.
Zero Down Still Means Bringing Money
This trips people up, so it is worth being plain about it. Even with a 100% loan, you should expect to need cash for:
- Closing costs, typically 2% to 5% of the purchase price (Freddie Mac, February 2026). On a $500,000 house that is $10,000 to $25,000.
- Reserves. Most programs require them and say the minimum varies by loan amount, without publishing how many months.
- Earnest money when your offer is accepted, usually credited back to you at closing.
- Inspection and appraisal costs, paid before you ever get to the table.
There is a lever here. Some programs publish seller contributions of up to 3% for residents. On a $500,000 purchase that is $15,000 toward closing costs, which in a slower market is often negotiable. Ask your agent to try for it.
Why a Bank Is Willing To Do This
It is not generosity, and understanding the logic will help you evaluate the offer.
Physician loans are portfolio loans, meaning the bank keeps them on its own books instead of selling them to an investor. The bank keeps them rather than selling them to Fannie Mae or Freddie Mac, which means it is not bound by agency down payment rules and can price the risk itself. Physicians default at very low rates, income is steep and predictable, and the bank is also buying a long-term banking relationship with a high earner.
That is the whole trade. You get the terms because the bank believes the bet is safe.
What Skipping Private Mortgage Insurance Is Actually Worth
Zero down is the headline, but on a conventional loan the down payment and the mortgage insurance are the same conversation. Put less than 20% down on a conventional mortgage and the lender requires private mortgage insurance, which protects the lender, not you, and you pay for it every month until you have enough equity to cancel it.
Physician loans skip it entirely. That is the part worth putting a number on.
PMI runs roughly 0.46% to 1.50% of the loan amount per year, according to the Urban Institute’s Housing Finance Policy Center. Where you land depends mostly on your credit score and how little you put down. A borrower at 760 or above sits near the bottom of that range; a borrower in the low 600s sits near the top.
Run it on a $500,000 loan:
| Annual PMI rate | Per year | Per month | Over five years |
|---|---|---|---|
| 0.50% | $2,500 | $208 | $12,500 |
| 0.75% | $3,750 | $313 | $18,750 |
| 1.00% | $5,000 | $417 | $25,000 |
| 1.50% | $7,500 | $625 | $37,500 |
That is money you do not get back and that builds no equity. On a physician loan it is simply not charged.
Two things keep this honest. First, PMI is not permanent on a conventional loan. Federal law requires the servicer to cancel it automatically once the balance is scheduled to reach 78% of the home’s original value, and you can usually request cancellation at 80%. So the real comparison is a few years of PMI, not thirty. Second, a physician loan often carries a slightly higher interest rate than a comparable conventional loan, and that rate difference does last the life of the loan. A quarter point on $500,000 is roughly $1,250 a year, every year.
So the arithmetic is not automatic. Skipping PMI is worth the most when you would otherwise be paying a high PMI rate for several years, and worth the least when you have strong credit, a rate premium on the physician side, and a plan to reach 20% equity quickly. Ask any lender you talk to for both quotes, with and without PMI, and compare the total cost over the years you actually expect to hold the loan.
The Equity Risk, Said Plainly
With nothing down, you own no equity on day one. If home values in your area dip 5% and you need to sell, you would owe more than the house is worth and would have to bring cash to close.
This matters more than usual for people in training, because training is temporary. A three-year residency and a two-year fellowship are short windows to hold real estate through. Selling costs alone, agent commissions and closing fees, commonly run 6% to 10% of the sale price. A flat market plus zero equity plus selling costs is how people lose money on a house they liked.
None of that means do not do it. It means run the numbers on how long you will actually be there before you decide. We work through that in buying a house during residency.
Zero Down Versus Putting Something Down
The honest comparison is not zero down against 20% down. It is zero down against what else that money could do.
On a conventional loan with less than 20% down, you pay private mortgage insurance, roughly 0.46% to 1.50% of the loan amount per year depending on your credit score (Urban Institute, May 2026). On a $700,000 loan that is $270 to $875 a month. Physician programs that require no PMI remove that cost entirely, at any down payment level.
So the physician loan advantage does not disappear if you put money down. It is worth asking your lender to quote you at zero, at 5% and at 10%, then comparing full monthly payments rather than rates. Sometimes a small down payment moves you into a better pricing tier and pays for itself.
And if you do end up on a conventional loan with PMI, it is not forever. You can request cancellation once the balance reaches 80% of the original value, and it terminates automatically at 78% (12 U.S.C. 4902).
When Zero Down Makes Good Sense
- You are moving for a job and want to stay put for five or more years
- Your cash is better used on an emergency fund, a retirement match, or paying down high-interest debt
- You are buying well under what you qualify for
- Rent in your market is close to or above the mortgage payment
When It Does Not
- You are in a three-year training program and unsure where you land next
- You would be stretching to the top of your approval amount
- You have no reserves at all after closing
- You are buying in a market that has run up fast and may cool
That fourth one deserves care. Zero down is a leverage decision, and leverage cuts both ways.
Where to Go From Here
If a zero down tier is what you are after, the practical question is which lenders offer it for your degree, in your state, at your price point. That is the matching we do.
Tell us your situation and we will point you at a lender whose published terms fit. About two minutes, no cost to you.
Related: how physician mortgage loans work, what it takes to qualify, and how much house you can actually afford.
Last verified September 9, 2026, against published lender disclosures. We recheck this page monthly.