Flagstar Bank Physician Loan Review (Updated 2024)

Widest range of medical specialties eligible. Get 100% financing up to $1.5MM

 

What is Flagstar Bank?

Flagstar Bank is a financial institution with a significant footprint in the banking and mortgage sectors. Established in 1987, it has grown into a $27 billion savings and loan holding company, ranking as the 6th largest mortgage originator nationally. Flagstar provides a diverse range of services, including personal, business, and commercial banking.

Flagstar Bank’s reach extends beyond its 158 branches in Michigan, Indiana, California, Wisconsin, and Ohio, providing mortgage services across all 50 states. This nationwide presence has boosted its reputation as a reliable choice for home loans, including specialized products like the Physician Mortgage Loan.

 

Flagstar Bank Physician Loan Highlights

Flagstar Bank’s Physician Mortgage Loan, often referred to as the ‘professional loan,’ is open to a wide array of medical professionals, not just doctors. This inclusivity sets it apart from many other physician loans in the market.

These are the key highlights of the Flagstar’s Physician Mortgage Loan:

• Designations: MD, DDS, DMD, OD, MD, DPM, DO, NP, RPH, PharmD, DVM, PA, CRNA
• Primary residence
• Purchase or refinance
• 100% financing up to $650k for residents in training
• 100% financing up to $1MM
• 95% financing up to $1.5MM
• Adjustable-rate mortgages (ARMs) only
• Available in all 50 states

These last two loan options are for attending physicians only with at least one year practicing. So if you are a resident and want a loan for more than $650k, you would need to make a down payment. And like was mentioned above, this program is available in all 50 states.

Pros of Flagstar Bank Physician Mortgage Loans

Choosing Flagstar Bank for your physician mortgage loan comes with several advantages.

Wide Eligibility

Unlike many providers, Flagstar Bank’s program is open to a wide array of medical professionals and high-income professions. This inclusivity can be a significant advantage for professionals like registered nurses, pharmacists, and ATP pilots who often find themselves excluded from other physician loan programs.

Zero Down Payment Option

Flagstar Bank offers a zero down payment option for loans up to $1 million for those with a credit score of 720 or more. This feature can be incredibly beneficial for medical professionals who may not have a large amount of savings due to high student loan debts.

No PMI Requirement

This program does not require private mortgage insurance (PMI), even for mortgages with low down payments. This absence of PMI could save you a substantial amount of money over the life of your loan.

First-Time Homebuyer Friendly

The program is particularly beneficial for first-time homebuyers, allowing them to get a loan as high as $1 million with 100% financing. It’s a significant step toward making homeownership a reality for young professionals just starting their careers.

Cons of Flagstar Bank Physician Mortgage Loan

While the Flagstar Bank Physician Mortgage Loan offers numerous benefits, it’s essential to consider potential drawbacks.

Limited to First-Time Homebuyers

The zero down payment option is available only to first-time homebuyers. If you have previously owned a home, you may not qualify for the best option.

Higher Credit Score Requirements

Flagstar Bank requires a minimum credit score of 700 for 5% down payment options, and a score of 720 for zero down payment options. These requirements might be challenging for those with lower credit scores.

Only Available for Primary Residences

The program is applicable only for the purchase or refinance of primary residences. If you’re looking to invest in a vacation home or rental property, this loan program won’t cater to your needs.

Adjustable-Rate Mortgages Only

Flagstar Bank’s physician loan program only offers adjustable-rate mortgages (ARMs). While ARMs can offer lower initial interest rates, they come with increasing rates over time. If you prefer the stability of a fixed interest rate, you might want to consider other options.

Flagstar Bank Physician Loan Alternatives

 
Cadence Bank

Cadence Bank recently merged with BancorpSouth to become an even larger bank than it was before. It still has a limited footprint (southern states) but an excellent doctor home loan program where you can get 100% financing up to $1.5MM. Learn More: Cadence Bank Physician Loan Review

TD Bank

TD Bank’s physician mortgage is a popular choice among LeverageRx readers. The bank provides 100% financing up to $750k for both residents in training and attendings. The loan is for primary residents only. Learn More: TD Bank Physician Loan Review

Truist

Truist was formed through the combination of BB&T and SunTrust. The program provides full financing up to $1MM for the following designations: MD, DO, DPM, DDS, DMD. Learn More: Review of Truist Physician Loan

Key Takeaways

The Flagstar Bank Physician Mortgage Loan can be an excellent option for medical professionals seeking to buy a home. Its 100% financing option, absence of PMI, and broad eligibility make it an attractive choice. Always remember to choose a loan that best fits your financial situation and homeownership goals. Working with a physician mortgage broker like LeverageRx can simplify your search for the right lender greatly by connecting you with physician mortgage lenders based on your specific details.