Minnesota has a population of 5.7 million people. It boasts many Fortune 500 companies, has an affordable cost of living, and has many recreational resources, making it a great place to live.
Minnesota has around 19,000 working physicians and a good handful of lenders willing to work with physicians to simplify homeownership.
Whether you’re just starting your fellowship or have worked for a practice for a few years, Minnesota offers excellent physician loan options.
7 Best Minnesota Physician Home Loan Lenders
Here’s a list of Minnesota’s top seven physician mortgage loan lenders.
Discover The Best Lenders in Minnesota Answer just a few questions about your career, where you're buying, and how much you want to borrow. Our service will then show you the exact programs you're eligible for from vetted physician loan specialists who will guide you through every step of the process – obligation-free!
1. BMO Bank
- BBB Grade: A+
- JD Power Score: 805
BMO Bank helps residents, fellows, and new doctors secure attractive financing to buy a home. You can use the doctor loan program until you’ve been established for ten years, but even then, you may still qualify with a 10%+ down payment.
BMO Bank is one of the most forgiving banks with various property options, including single-family homes, condos, PUDs, and up to 2-unit properties. Doctors need a 5% down payment on loans up to $1.5 million and 10% on loans of $1.5 million to $2 million.
BMO offers three financing options in Minnesota:
- 100% financing up to $1 million
- 95% financing for $1 – $1.5 million
- 90% financing for $1.5 – $2 million
Key Features of a BMO Bank Physician Mortgage Loan
BMO Bank is one of the top ten largest banks in the United States, with millions of clients worldwide. With 140 years of experience, they have been through a lot and have always put the customer first.
Doctors who apply to BMO Bank can get a loan with no PMI and the ability to close the loan before officially starting work. Your employment contract must begin within 90 days to qualify, though.
In addition, if you set autopay, BMO Bank will reduce your closing costs by $500.
Eligible Doctors:
The BMO Bank doctor loan program is open to MDs, DOs, DMDs, and DDSs.
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2. Bank of America
- BBB Grade: A+
- JD Power Score: 894
Bank of America offers many banking products, including a physician’s loan in Minnesota. To qualify, borrowers need a Bank of America bank account and cash reserves to prove they can afford the loan, but they’ll exclude student loan debt from the equation.
Physicians can borrow up to $2 million for doctor loans in Minnesota, but all loans require at least a small down payment, including the following:
- Up to $850,000 – 3% down
- Up to $1 million – 5% down
- Up to $1.5 million – 10% down
- Up to $2 million – 15% down
Key Features of a Bank of America Physician Mortgage Loan
Bank of America is a well-known bank in the US. They offer products for individuals, professionals, and business owners. In addition, they continually offer new products to meet the ever-changing needs of society.
Minnesota doctors can take advantage of the Bank of America doctor loan with no PMI, student loans excluded from the debt-to-income ratio, and the chance to close before starting work if the employment contract begins within 90 days.
Eligible Doctors:
Bank of America offers its physician loan program to doctors, including MDs, DOs, DDSs, DMDs, ODs, and DPMs.
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3. Citizens Bank
- BBB Grade: A+
- JD Power Score: 818
Citizens Bank offers physicians in Minnesota a competitive loan product that you can get within the first ten years of your career. Citizens Bank offers fixed and adjustable-rate loans, but they don’t offer a no down payment option.
Despite being one of the country’s larger banks, it only allows loans up to $1 million, and they require doctors to put down 5% to 10%, depending on their qualifying factors. While this may seem frustrating compared to other loans in this list, it prevents you from getting in over your head.
Key Features of a Citizens Bank Physician Mortgage Loan
Being a well-known bank with billions of dollars in assets, the bank has a reputation for excellent customer service and offers 24/7 access to customer service representatives, which can be great for doctors who aren’t available during traditional banking hours.
They offer doctors in Minnesota many options, including fixed or adjustable-rate loans, and an option for self-employed doctors, even if they just started.
Eligible Doctors:
This physician loan product is available to MDs, DOs, DDSs, and DMDs.
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4. Evolve Bank & Trust
- BBB Grade: N/A
- JD Power Score: N/A
Evolve Bank & Trust offers a doctor’s loan program with flexible underwriting guidelines that can be tailored to each physician’s needs. It’s open to many property types, and many medical professionals are eligible, including veterinarians.
Evolve Bank offers physician loans on 1 to 4-unit properties, up to $2 million. However, buying anything but a single-family home may require higher credit scores or larger down payments.
Key Features of an Evolve Bank & Trust Physician Mortgage Loan
Evolve Bank offers a wide selection of financing products for doctors and other professionals in Minnesota. They are known for excellent customer service and a streamlined application process. The program is open to fellows, residents, and any doctor with less than ten years of experience.
Eligible Doctors:
Evolve Bank offers physician loans in Minnesota to MDs, ODs, DDSs, DMDs, NPs, clinical nurse specialists, and pharmacists.
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5. Flagstar Bank
- BBB Grade: A+
- JD Power Score: 781
Flagstar Bank has a loan program that helps physicians buy a home, but it’s open to other professionals too. To qualify for the program, you must be a first-time buyer or not have owned a home in the last three years.
Flagstar Bank’s physician loan program is only for primary residences and first-time buyers. Doctors can borrow up to $1 million with no down payment; however, you need great credit, usually around 720, to qualify. If you need to borrow more than $1 million, you may need to put money down on the home.
Key Features of a Flagstar Bank Physician Mortgage Loan
Flagstar offers an attractive loan program for doctors in Minnesota with competitive interest rates. Unfortunately, they only offer adjustable-rate loans, but many doctors prefer this because the introductory rate is often low.
Flagstar is a newer bank that opened in 1987. They’ve mastered the physician loan program, making it easy for doctors in Minnesota to get financing. Unlike other lenders on the list, they also allow interested-party contributions.
Eligible Doctors:
Flagstar’s physician loan program is open to most doctors, nurses, dentists, and veterinarians.
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6. Huntington Bank
- BBB Grade: A+
- JD Power Score: N/A
Huntington Bank offers a competitive physician loan for purchases and refinances. The program offers various down payment options, but most doctors need cash reserves to get approved, so keep that in mind as you explore your options.
The Huntington Bank physician loan program only applies to primary residences. Physicians can borrow 100% on up to $1 million but need 5% down on $1.25 million and 10% on $2 million.
Key Features of a Huntington Bank Physician Mortgage Loan
Huntington Bank has a long history dating back to 1866. They have an excellent physician loan program and many other financial products. Huntington Bank is known for its great customer service, helping doctors and other consumers get the financial products they need.
Like most lenders on this list, they don’t charge PMI or have a prepayment penalty. They also have fixed and adjustable rates available.
Eligible Doctors:
The Huntington Bank doctor’s program is open to MDs, DOs, DMDs, DVMs, and DDSs.
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7. US Bank
- BBB Grade: B+
- JD Power Score: 801
US Bank is one of the country’s top mortgage lenders with a robust physician loan program. While they don’t have a no down payment option, and the program isn’t open to dentists, there are attractive options for doctors.
Doctors in Minnesota need a 5% down payment on $1 million, 10% down on $1.5 million, and 15% down on $2 million with US Bank.
Key Features of a US Bank Physician Mortgage Loan
US Bank is one of the country’s oldest banks. They have excellent customer service and various financial products, including physician loans in Minnesota.
The US Bank physician’s loan is available to residents and fellows, and like most lenders on this list, no PMI is required.
Eligible Doctors:
The US Bank physician loan program is open to MDs and DOs.
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Pros and Cons
Physician mortgage loans, like any loans, have pros and cons; here’s what to consider.
Pros
- Zero Down Payment: Many physician loans in Minnesota don’t require a down payment. Even with loan amounts as high as $1 million or more, you can often get approved with no money down. This makes it easier to afford a loan sooner.
- No PMI: All lenders on our list don’t charge PMI for doctor loans. This means you can put no money down and won’t have to pay mortgage insurance.
- Student Loans Excluded: Student loans usually take up a large amount of a doctor’s pay, making it hard to get approved for mortgage financing. However, physician loans usually exclude student loans from the DTI to make qualifying easier.
- Purchase Home Before Job: Many lenders allow doctors to purchase a home with an employment contract that hasn’t started yet, as long as it begins within the next 90 days.
Cons
- Interest Rates: Doctor loans have higher interest rates to make up for the risk and lack of PMI. However, the higher rates increase your mortgage payment and cost more over the loan’s term.
- Residence Requirements: Many doctor loans in Minnesota are only for primary residences. Unfortunately, this means you can’t buy a vacation or investment home with them.
- Unrealistic Expectations: Because of the relaxed guidelines, it’s easy to borrow more than you can realistically afford, making it easy to get in over your head.
Frequently Asked Questions
What is the difference between a physician loan and a conventional loan in MN?
A physician loan is only for doctors in residency, fellowship, or the early years of their careers. The loan excludes student debt and often doesn’t require a down payment. However, lenders keep physician loans on their books; a government agency doesn’t back them.
Conventional loans have stricter guidelines but are open to anyone who qualifies. Borrowers need at least a 3% down payment (5% if you owned a home before), and the guidelines must meet Fannie Mae or Freddie Mac’s requirements as they back the loans.
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How much student loan debt does the average doctor have?
The average doctor has $202,250 in student loan debt.
What type of doctor receives the best physician mortgage loan rates in MN?
The type of doctor you are doesn’t determine your rates. Instead, lenders base your rate on your credit score, DTI, and loan-to-value ratio. The better your qualifying factors are, the easier it is to qualify for a loan with a great interest rate.
Who Is the Best Candidate for a Physician Loan in Minnesota?
A physician loan is a big undertaking, but here’s who may benefit the most.
Medical Professionals Early in Their Career
Doctors just starting their careers often benefit from a physician’s loan because of the lack of down payment and the exclusion of student loan debt from the DTI. Just be careful that you don’t borrow more than you can afford.
Doctors Looking To Refinance
If you already own a home but need a different rate or term, you can use the physician loan to refinance. You won’t need much equity in the home, and lenders can overlook your student debt to help you get more favorable terms.
Doctors Who Want a Bigger Home
If you want a bigger home after graduating from med school, you can use a physician loan to buy it. They often don’t require a down payment and have flexible underwriting guidelines, making it easier for doctors to secure financing.
Medical Residents With a Lot of Student Debt
Doctors leave school with a lot of debt which can prevent them from getting mortgage financing. However, medical residents with an employment contract or who have already started their careers can get a physician loan with no down payment, no PMI, and relaxed guidelines to help them own their dream home, even with the debt.
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