You’ve heard about physician loans and now you’ve decided to get one. Now what? We’ll walk you through every step of the buying process so you know what to expect and you can feel less anxious and more excited about getting your physician home loan!
Find a Mortgage Loan Officer
You can work with a direct lender like Physician Bank to avoid the hassle of third-party lenders. You will have your own designated physician home loan officer and access to your own Private Banker that will work with you from your loan application to closing and beyond.
Understand your Credit
Credit will be a key factor in determining your eligibility for a physician home loan and the rates you will be offered. The better your credit score, the more flexibility you will have.
Your credit score is determined based on previous credit performance, current debt levels, credit, and payment history, if you have newly acquired debt, type and frequency of your debt, and more.
Pay attention to your credit and follow good credit best practices to ensure your score stays as high as possible.
Prepare for the Costs of Homeownership
There are more costs outside of the monthly mortgage payment when it comes to home-buying that you might not expect:
- Upfront costs
- Keep in mind initial costs including your down payment, closing costs, and reserves needed in your checking or savings account.
- Budget for expenses
- Ongoing expenses you’ll acquire that may include maintenance/upkeep, property taxes, insurance, homeowner association (HOA) fees (if applicable).
After choosing your lender and applying for the loan, you’ll get a pre-approval for your loan that allows you to get an accurate pricing estimate based on your credit and financial situation. Getting preapproved will also give you more credibility with the seller because you’ll be prepared financially, which would help your chances if you made an offer.
Be ready to provide some necessary documentation for this stage of the process. To process your preapproval, you will typically be asked for things like your official identification, address, and employment history, pay stubs, tax return information, etc.
Select a Real-Estate Agent
It’s not necessary to work with a real-estate agent, but it can make home shopping easier. An agent can access Multiple Listing Services (MLS) and provide professional insight on the housing market in your area.
Find a home
Congrats, you’ve been preapproved! Now it’s time to find your home! In this part of the process, you’ll work with your realtor to find a home best suited for you.
Make a list of “non-negotiables” that will be deal-breakers in selecting a home. For example, you may be flexible on which city you choose, but it must fall within a certain school district you want for your kids. You could have a minimum number of bedrooms and bathrooms on your list. Your list can keep you from making rash decisions and forgetting key details of what you’re looking for.
Since you’re already preapproved, that will help guide you with your budget and help narrow down home contenders. Be mindful of your budget and think about the monthly payments, property taxes, and other expenses and make sure you’re comfortable with it.
Make an offer
Now that you found a house, you’ll want to make an offer. You will work with your real estate agent on an offer letter to give to the seller.
The seller will choose to accept, deny, request changes, or make a counteroffer. Your real estate agent will work with you to navigate next steps.
Get a home inspection
Your offer on your dream home was approved! Now before closing, you’ll want to get a home inspection from a professional home inspector. Although this step is not required, a home inspection can save you a lot of time and money.
Home inspections look for things like unforeseen safety concerns or damage that will end up costing thousands to repair. Commonly found issues include mold, pest infestations, backed-up sewage systems, damaged electrical wiring, and more.
The inspector will look at the exterior and interior of the home and take note of any safety issues and defects. It’s a good idea to be present during the inspection so you can see any issues for yourself and ask any questions you have for the inspector.
Choose whether to close or move on
Now that your offer was accepted and your home inspection was clear of major red flags, it is time to decide whether to close. If you close, you’ll become the legal owner of a home! If not, you can keep searching and go through the process until you find a home that suits you.
The closing process will involve details like reviewing closing disclosure and other documents and selecting insurance plans.
After closing, you are officially a homeowner, congratulations!
If you have any questions about the home buying process, feel free to connect with one of our Physician Home Loan Originators.
Are you a physician in need of a loan? Physician Bank was made for you!
Start a conversation with us today.