Physicians and healthcare workers face long work days, a fast-paced environment in most cases, and pressure from the demands of patient care. Staying on top of finances can sometimes suffer. In order to prepare for applying for Physician mortgage loans, there are ways to stay on top of finances even with such a demanding job.
With physician home loans, healthcare workers are actually able to afford their own homes. The Doctor Mortgage Loan Program is designed to help professionals who qualify to receive a mortgage loan from participating lenders with zero to very little money down and no private mortgage insurance (PMI.)
However, in order to take advantage of the program, even doctors need to keep their finances in order.
The first line of defense is to start budgeting – and to stick to it.
A budget means keeping track of every dollar earned. There are many tools available on the market to help develop a strategy. The easiest thing is, to begin with listing monthly expenses – such as rent or car payments, utilities, and more. Staying within this budget and leaving room for savings will allow a potential borrower to maintain good credit and formulate a financial cushion.
A financial cushion – such as three to six months’ worth of savings – can help avoid potential borrowers from relying on credit cards in the event of a job loss or other emergency.
With inflation, the way it is, cutting costs can help unearth savings. Examples would be to
make more meals at home, take a packed lunch to work, eschew the temptation of daily expenses like a morning coffee that can add up, and get rid of unnecessary subscriptions like streaming services that are not being used.
Another critical step to staying financially organized is to pay down debt. Potential borrowers should make a list of all outstanding debts and then turn their attention to repayment. Whether it’s paying off the smaller debts first or focusing on the more significant, high-interest debt, by paying it down, borrowers are one step closer to being financially sound.
Though the average physician loan makes allowances for debt from med school debt, other debts are taken into consideration. So for an optimum debt-to-income (DTI) ratio, the less debt, the better.
Lenders base the loans on future earnings by qualifying physicians. However, it’s important not to be in “the red” when taking on a massive commitment such as a mortgage.
Being financially sound means the next step is finding a qualified lender to work with. Though a challenge, as not all banks or credit unions offer the doctor mortgage loan program, MD Mortgage Loans can help. They have compiled a list of Physician Mortgage Lenders and Banks by state and qualifications.