Tell Me About These Doctor Mortgages...

So, DH and I are in the early planning stages of buying a home in San Antonio, TX. At this point, we're really just looking around online, and we contacted our first real estate agent yesterday.

Anyway, from the little research I've done on physician mortgages, it seems to me that they're meant to give a good interest rate to someone who can't/doesn't want to put down a large downpayment. However, DH and I have been saving for a home since before we were married. Thus, we have enough to put down 20% percent on a $100K+ home. (A very reasonable price in the area we're moving to.) And thanks to the military, we have very little student loan debt--only about $40K total between him and me--and no other debt.

So, is a physican loan something we should seriously consider, or could we get a better rate with a combination of our good credit and a 20% downpayment? Could we somehow combine the physician loan with a hefty downpayment to get a truly great interest rate? Any ideas what makes the most financial sense, especially considering we'll probably be in the house for only four years?

Of course, we'll eventually talk to a mortgage broker about all this, but I'm sure you ladies can give us a good start!

Re: Tell Me About These Doctor Mortgages...

Typically the physician (or professional) loans are geared to those with a large amount of debt but with great potential for increased income- thus the draw for no or little down. Most the loans come with "personal" touches, private bankers, free this or that and so on...
With a good amount of money saved for a down payment, it is completely a personal choice if you would want a "physician loan" or the best loan that you can get from someone not offering one.
With this loan, it will come with a rate that is a combination of credit history and down payment. The 'typical' mortage required 20% down, but you may only be required to place 5-10% down. If you place the full 20% you would have instant equity. The combination of down and good credit history will get you a low rate, if you want it even lower you could always buy points up front. There are all sorts of ways to figure what is the best case scenario, it is truly a personal decision. You can do some checking on your own here...
http://www.dinkytown.com/ go to the mortgage calculator section and there you can play with all sorts of situations.
In San Antonio, I would guess that there will be a great amount of banks, large and small, that want the business that comes from the many military folks in the area. USAA has a great banking system with tons of other options tied together- investment advice, savings for retirement and college, etc.
The military Jenn could fill you in, I think that they do most- if not all- their banking with USAA.

I am not one of the ladies, but I hope that this is somewhat helpful.

[DCJenn]

Re: Tell Me About These Doctor Mortgages...

Amen to Matt-

We contacted USAA and didn't go with them only because we have a personal relationship w/ a lender from when we lived here the first time. Let me know if you want her name and number. She is amazing.

Also, DO NOT even consider making an offer until you get down here and see the town. San Antonio is really, really spread out and there are tons of communities to see.

Jenn

Re: Tell Me About These Doctor Mortgages...

Thanks to both of you! And sorry, Matt!

We're definitely going to go down to TX a couple of times to look for places. Hopefully we willl be working with a great real estate agent who can narrow our choices down to some great houses before we make the trip. Also, we already do most of our banking through USAA and love it! That's definitely one place we're planning to shop for a loan.

One last question. I know that the physician loans specifically advertise that you can use your new income when applying for a loan, but can you do that with most other mortgages? Right now, our combined income is at least $20K less than DH's pay alone will be once we move, so it's really important to us that we can use the new income, not what we currently make, when applying for a mortgage.

Thanks again!

Re: Tell Me About These Doctor Mortgages...

Oh, and Jenn, could you please PM me the contact info for your lender? Thanks!

[migirl]

Re: Tell Me About These Doctor Mortgages...

One last question. I know that the physician loans specifically advertise that you can use your new income when applying for a loan, but can you do that with most other mortgages? Right now, our combined income is at least $20K less than DH's pay alone will be once we move, so it's really important to us that we can use the new income, not what we currently make, when applying for a mortgage.

We (and I know others here have done the same) got a letter from DH's program specifying what his salary would be to give to the lending company. We had NO income when we applied for our mortgage (we were still in med school), so we had to have that letter in order to prove we could pay the mortgage payments!

[DCJenn]

Re: Tell Me About These Doctor Mortgages...

What you need is a Comparative Worth Statement. The military pay offices generate them.

It actually figures out what you are paid in terms of factoring in things that we don't have to pay like health insurance.

Tell them that you need a CWS for an O3 resident.

Another benefit of moving to San Antonio is that all of the lenders are familiar with military home buyers and the various programs that we have to our benefit.

Jenn

PS- I'll get the lender's information to you ASAP.