Physician mortgage loans are designed for doctors, dentists, and other medical professionals. They make homeownership easier by allowing little to no down payment and more flexible debt-to-income requirements. But just like any mortgage, you still need to budget for closing costs, which typically run 2 to 5 percent of the home’s purchase price. Using a physician mortgage calculator is the fastest way to estimate these costs and plan your finances before closing.
What is a Physician Mortgage?
A physician mortgage is a specialized home loan program created for medical professionals. These loans are particularly helpful for buyers with high student loan balances, limited cash for a down payment, or a short work history right out of residency.
Key benefits include:
- Low or no down payment requirements
- No private mortgage insurance (PMI)
- Flexible underwriting for student loan debt
- Recognition of signed employment contracts as proof of future income
While these loans help physicians enter the housing market earlier, they still come with standard costs like appraisals, inspections, and title fees.
Understanding Closing Costs
Closing costs are the collection of fees due at the end of the home-buying process. For physician mortgage loans, these often include:
- Loan origination and underwriting fees: Lender charges for processing the loan
- Credit report fee: Cost to check your credit during underwriting
- Appraisal fee: Confirms the value of the home matches the loan amount
- Home inspection: Optional but recommended to uncover property issues
- Title search and title insurance: Ensures the seller owns the property and protects against future disputes
- Survey fee: Verifies property boundaries and compliance
- Prepaid expenses: Homeowners insurance, property taxes, and prepaid interest
- Discount points: Optional payment to lower your interest rate
- Transfer taxes and recording fees: Local government charges for property transfer
Physician Mortgage Calculator
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How to Estimate with a Physician Mortgage Calculator
Closing costs usually equal 2 to 5 percent of the home’s price. On a $400,000 home, that means $8,000 to $20,000 in upfront expenses.
Instead of guessing, you can use a Physician Mortgage Calculator to estimate your total monthly payment and upfront costs. A good calculator allows you to:
- Enter your home price, down payment, and interest rate
- Compare 15-year vs 30-year loan terms
- See how rolling closing costs into the loan changes monthly payments
- Budget more accurately for your cash-to-close requirement
Many lenders that offer physician mortgage loans now provide online calculators specifically tailored for doctors, so you can estimate your expenses before applying.
Ways to Reduce Closing Costs
While closing costs are unavoidable, physicians can often reduce them with the right approach:
- Shop multiple lenders: Compare loan estimates to find lower origination and third-party fees
- Negotiate line items: Some fees, like courier charges, can be reduced or waived
- Choose your own providers: You are not required to use the title or inspection companies recommended by the lender
- Ask the seller for concessions: In a buyer’s market, sellers may agree to pay part of your closing costs
- Roll costs into the loan: Raises long-term expenses but lowers upfront cash requirements
Key Takeaways
Physician mortgage loans are an attractive path to homeownership for doctors and dentists, but closing costs are still a significant expense. These fees typically equal 2 to 5 percent of the home price and cover appraisals, title services, inspections, and prepaid items. The simplest way to budget is by using a physician mortgage calculator, which shows both your monthly payment and cash-to-close estimate. By shopping around, negotiating fees, and leveraging seller concessions, physicians can reduce costs and make the home-buying process more affordable.
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