Applying for physician mortgage loans in New Jersey can help you make your dreams of homeownership, or refinancing your existing home at a lower rate, a reality.
Early-career medical professionals face many barriers to homeownership, including limited savings, high student loan debt, and scarce time to shop for a home amid hectic scheduling.
Securing the right physician loan program can help you overcome these barriers so you can establish permanent roots in your community while building long-lasting financial equity.
The Garden State is home to more than 30,000 practicing physicians, making it one of the most popular choices for practicing medicine in the country.
New Jersey continues to be a prevalent choice for both physicians and others, with almost 9,000,000 people choosing to call it home.
Once you’re ready to settle down in New Jersey, we recommend getting pre-approved with our preferred lenders. They’re ready and eager to help you through the home-buying process.
11 Best New Jersey Physician Home Loan Lenders
Here are the top physician mortgage loan lenders in NJ:
- BMO Bank
- Citizens Bank
- Evolve Bank & Trust
- First Horizon Bank
- Flagstar Bank
- Fulton Bank
- Huntington Bank
- KeyBank
- TD Bank
- Truist Bank
- U.S. Bank
Discover The Best Lenders in New Jersey 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 offers its Physicians’ Mortgage Program to licensed medical doctors, including the following designations:
- MD
- DDS
- DMD
- DO
Current residents and fellows are also eligible for financing. Loans may be used to purchase or rate/term refinance a primary residence in all states except New York.
Eligible property types include 1-2 unit properties, single-family homes, condominiums, and townhomes. Rental and investment properties aren’t eligible for financing through this program.
The program has flexible underwriting guidelines regarding student loan debt, which can make it easier to qualify than a conventional loan program.
It also doesn’t have income history requirements. Instead, it will accept proof of future income through a residency agreement or fully executed employment contract. Employment contracts must start within 90 days of closing to qualify.
Borrowers can secure up to 95% financing on loans up to $1.5 million or 90% financing on loans up to $2 million. Medical professionals who have been practicing for 10 years or more are still eligible for the program, but they will be limited to 90% financing.
All down payment options exclude private mortgage insurance (PMI). All standard fixed-rate and adjustable-rate mortgage options are available.
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2. Citizens Bank
- BBB Grade: A+
- JD Power Score: 818
Citizens Bank’s physician mortgage loan program will provide up to 95% financing for qualified medical professionals interested in purchasing or refinancing a home they plan to use as their primary residence.
The program is open to medical doctors and dentists, including MDs, DOs, DDSs, and DMDs. Residents and fellows are also eligible for the program.
The program provides the following down payment options with no PMI:
- 5% down payment on loans up to $850,000
- 10% down payment on loans up to $1 million
- 15% down payment on loans up to $1.5 million
In some cases, the program may even provide construction loans for physicians interested in building a new home. Borrowers who hold an account with Citizens Bank may receive a discount.
Deferred student loans won’t factor into debt-to-income calculation, but borrowers can use their reduced income-driven repayment amount as well if they’re making payments.
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3. Evolve Bank & Trust
- BBB Grade: B
- JD Power Score: N/A
Evolve Bank & Trust offers its doctor loan program to an expansive list of medical professionals. The following medical designations are included:
- Clinical Nurse Specialists
- CRNA
- DC
- DDS
- DMD
- DO
- DPM
- DVM
- MD
- NP
- OD
- PA
- PharmD
- Residents/fellows
Self-employed medical professionals are also eligible, but all applicants must be within the first ten years of their career to qualify.
Interested borrowers can apply for no-cost fully underwritten pre-approval with Evolve Express Mortgage so they can go into the home-buying process armed with a good idea of their budget.
The program will approve borrowers with non-occupant co-signers and interested-party contributions, meaning a parent or loved one can give money toward the down payment or closing costs. Borrowers may also pursue a non-occupant cosigner if their creditworthiness on their own doesn’t meet the underwriting team’s risk guidelines.
Like other physician loan programs, Evolve Bank & Trust will be flexible in its DTI calculations. Its dedicated team is knowledgeable of the unique needs of medical professionals and it will work to provide an intuitive and personalized experience.
It is also considered a portfolio product, which means the lender will not sell the loan to another provider down the line.
In some cases, borrowers may be eligible for closing cost discounts. Loans may be used to purchase an existing 1-4 unit property, single-family home, or condominium. Evolve Bank & Trust also provides construction loans through this program.
Borrowers may secure up to $1 million without a down payment, but loans up to $1.25 million will require a minimum down payment of 5%. Loans up to $1.5 million require a 10% down payment. Loans up to $2 million require a 15% down payment. All down payment options waive PMI.
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4. First Horizon Bank
- BBB Grade: A+
- JD Power Score: 825
First Horizon Bank’s physician loan program is available to practicing medical professionals with the following degrees:
- MD
- DO
- DPM
- OMS
However, it’s important to note that the program is not open to residents. Compared to other lenders, First Horizon Bank is more flexible with its credit score requirements. The program has a 670 minimum score requirement.
Student loans deferred for 12 months or more will not be included in DTI calculations. All down payment options exclude private mortgage insurance and the following options are available:
- 100% financing on loans up to $1.5 million
- 95% financing on loans up to $2 million
- 90% financing on loans up to $2.5 million
The $2.5 million maximum loan amount makes First Horizon Bank one of the most generous physician loan programs on this list, which can be particularly advantageous in areas of New Jersey with a high cost of living.
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5. Flagstar Bank
- BBB Grade: NR
- JD Power Score: 781
Flagstar Bank offers an inclusive Professional Loan program open to a variety of high-income earners within the first 10 years of their careers. The following professionals are eligible for special financing options:
- ATP Pilot
- Attorney
- Certified Public Accountant (CPA)
- Clinical Nurse Specialist
- Doctor of Dental Medicine (DMD)
- Doctor of Dental Surgery (DDS)
- Doctor of Ophthalmology (MD)
- Doctor of Optometry (OD)
- Doctor of Osteopathy (DO)
- Doctor of Pharmacy (PharmD)
- Doctor of Podiatric Medicine (DPM)
- Medical Doctor (MD)
- Medical Resident (Educational License)
- Nurse Anesthetist (CRNA)
- Nurse Practitioner (NP)
- Physician Assistant (PA)
- Registered Nurse (RN)
- Veterinarian (DVM)
Borrowers will need a 720 minimum credit score to qualify for 100% financing on loans up to $1 million, but the program will extend a maximum of $1.5 million with low down payment options.
It’s important to note that all loans through this program will be adjustable-rate mortgages (ARMs), which means the interest rate will change over time after the introductory rate expires.
However, this lender will accept interested party contributions which can help offset some of the initial costs of purchasing a home.
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6. Fulton Bank
- BBB Grade: A+
- JD Power Score: N/A
Fulton Bank extends its Physicians’ Mortgage program to physicians, pharmacists, dentists, and veterinarians. The program offers the following financing options:
- Zero down payment on loans up to $1.5 million
- 5% down payment on loans up to $2 million
- 10% down payment on loans up to $3 million
Private mortgage insurance is not required. Through this program, the seller may pay up to 6% of the total closing costs, which can further reduce the cost of purchasing a home. Gift funds from immediate family members will be accepted.
Student loans deferred for more than a year will not be factored into the credit approval process. Employment contracts dated within 90 days of closing will be considered proof of income.
You can choose from 15 and 30-year fixed-rate mortgages, or the following adjustable-rate options: 5/6, 7/6, 10/6, and 15/6. Borrowers who already own their homes may be eligible for refinancing options, but availability may depend on loan-to-value and existing equity in the home.
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7. Huntington Bank
- BBB Grade: A+
- JD Power Score: 821
Huntington Bank’s physician mortgage loans are inclusive of residents and physicians with an MD, DO, DDS, DVM, or DMD degree. Borrowers will be required to provide proof of sufficient income or an active employment contract. All loans will have cash reserve requirements, but the required reserves will depend on the loan amount.
Huntington offers the following down payment options with requiring PMI:
- No money down on loans up to $1 million
- 5% down on loans up to $1.25 million
- 10% down on loans up to $2 million
The lender will calculate borrowers’ maximum loan-to-value based on creditworthiness. Loans are limited to the purchase or refinance of a primary residence.
Cash-out refinances up to $2 million are available, but borrowers may only take $250,000 in cash––all other funds must go toward existing debts.
Borrowers may prepay their mortgage balance before the loan term expires without penalty.
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8. KeyBank
- BBB Grade: A+
- JD Power Score: 794
KeyBank offers its Medical Professional Mortgage Program to physicians, doctors of osteopathic medicine, dentists, and podiatrists.
The Medical Professional Mortgage Program is unique in that it will extend up to a whopping $3.5 million for the purchase or refinance of a primary residence or second home.
Physician mortgage loans rarely offer to finance second homes, so KeyBank can be a great option for borrowers looking to buy a vacation home. Eligible property types include attached or detached single-family homes, condominiums, or townhouses.
The lender provides a fully personalized experience so borrowers can feel confident they’re choosing a loan product that fits their needs and goals for the future.
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9. TD Bank
- BBB Grade: A+
- JD Power Score: 837
TD Bank offers its Medical Professional Loan Program to practicing physicians, dentists, and oral surgeons within the first ten years of their careers.
Loans may be used to purchase a single-family home, condominium, or planned unit development. In select markets, co-op properties may also be eligible.
Mortgages are available with a fixed or adjustable interest rate. The following down payment options are offered:
- 0% down on loans up to $1 million
- 5% down on loans up to $1.25 million
- 10% down on loans up to $1.5 million
All down payment options come without private mortgage insurance, which can make a physician loan a lower monthly payment than a conventional loan of the same amount in some cases.
TD Bank will also use flexible underwriting guidelines for borrowers with a high debt-to-income ratio, which is common for residents, fellows, and other early-career medical professionals.
Residents and upcoming physicians can also qualify for a mortgage with a signed employment contract. Physician mortgage loan programs will often accept employment contracts so medical professionals can easily relocate to the area and establish long-term roots in their communities.
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10. Truist Bank
- BBB Grade: A+
- JD Power Score: N/A
Truist Bank doesn’t disclose much about its physician loan program offerings, but there are a few key details we can share. First, the following medical designations are eligible for the program’s special financing options:
- MD
- DO
- DPM
- DDS
- DMD
Residents are included.
Second, the program has a 15-year age limit, meaning applicants must be within the first 15 years of practicing to be considered.
Borrowers within the first ten years of practicing are eligible for zero money down financing options, but later career physicians will have to put down at least 10% to qualify.
Finally, the program has a maximum loan amount of $2 million.
Student loan debt isn’t totally excluded from debt-to-income calculations, but the lender will be more lenient than many other loan programs on the market.
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11. U.S. Bank
- BBB Grade: A-
- JD Power Score: 820
U.S. Bank’s physician loan program is open to residents, fellows, MDs, and DOs with a 710 minimum credit score. The program will provide up to $2.5 million, but the down payment options vary depending on the loan amount.
Loans up to $1 million require a 5% down payment. Loans up to $1.5 million require a slightly larger 10% down payment. The down payment amount increases proportionally to 15% for loans up to $2 million.
Borrowers who open a platinum checking account may be eligible for a 0.25% lender credit––up to $1,000. This credit can reduce some of the fees associated with processing the loan.
Like other physician loan programs, U.S. Bank is thoughtful in its approach to student loan debt. Underwriters will use 2% of the total student loan balance for borrowers in deferment or the actual monthly payment for borrowers on an income-driven repayment plan when calculating debt-to-income ratios.
Borrowers may also be asked to demonstrate up to twelve months of cash reserves depending on the loan amount.
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How Physician Mortgage Loans Work in New Jersey
Physician mortgages are home loan products designed to help early-career medical professionals pursue homeownership.
Physician mortgage loans work by attracting high-income earners to financial institutions, like mortgage brokerages, banks, and credit unions. High-income earners are likely to bring more business to the bank over time, making it beneficial for institutions to build relationships with these professionals early on.
Mortgage lenders understand the plight of early-career physicians, particularly medical residents, and fellows, so they are willing to offer home loans to these professionals with more lenient terms.
While these medical professionals have spent more than a decade training to begin their careers, the general public has been saving and building work experience.
Non-Conforming Loans
Conforming loans are subject to loan limits set by Freddie Mac and Fannie Mae. Physician loans are non-conforming loans, which allows them to offer loan amounts of more than $2 million in some cases.
Low Down Payment Options
Medical professionals are eligible for low down payment options through physician mortgage loans. While other mortgage programs will require a down payment or recurring insurance fees, physician mortgage loans will finance 85–100% of the home’s purchase price without requiring private mortgage insurance (PMI).
Physicians, dentists, veterinarians, and other advanced degree healthcare professionals are likely to earn substantial six-figure salaries by the time they reach their full earning potential.
Flexible with Debt-to-Income Ratio
Even though many of these early career professionals graduate with student loan debt from medical school, it’s rarely as crippling as it is for the general public.
Medical professionals, especially physicians, tend to pay off their student loans quicker while also being eligible for specific forgiveness programs, such as Public Service Loan Forgiveness.
For this reason, many mortgage lenders are comfortable being flexible when calculating the debt-to-income (DTI) ratio for borrowers with student loan debt. Student loan debt deferred for twelve months or more is often excluded.
Other programs may use a small portion of your total student loan balance or your actual income-driven repayment amount if you’re on an income-adjusted plan.
Flexibility with Employment History & Income
Because physicians don’t have the income history that conventional mortgage loans require, it’s possible to purchase a new home or refinance your current home shortly after signing an employment contract for a new job. Many programs will accept future-dated employment contracts in lieu of pay stubs and previous years’ tax returns.
Credit Score Requirements
While physician mortgage loans are more lenient than conventional loans in many ways, they’re more restrictive in other ways. While FHA loan programs will often work with borrowers with credit scores as low as 580, many physician loan programs will often want a 700 minimum credit score.
Limited to Primary Residence Lending
Physician mortgage loans are also limited to the purchase or refinancing of a primary residence. There are a few exceptions to this rule, such as KeyBank’s Medical Professional Mortgage Program, but that’s unusual.
Getting Started with a Physician Loan
Living in New Jersey means you’ll be able to choose any lifestyle you want- whether it’s a beach town, city life, or quiet suburb. A physician mortgage loan is a way to secure the best style of living for you and your family, no matter where you choose to call home.
Starting the process of a doctor home loan in New Jersey is easier than you think. The best option is to work with a lender who understands the financial and scheduling challenges you face as a physician.
Also, getting pre-qualified for a physician mortgage loan is an important step in the home loan process. Getting pre-qualified will help you navigate your new finances and understand the impact on your monthly budget.
When you do find a home you love, being pre-qualified will show the seller how serious your offer is.
Pros and Cons
Like all financial decisions, physician mortgage loans in New Jersey have positives and negatives. We’ve prepared a few of the notable pros and cons to help you make an informed decision about the mortgage loan program that best fits your needs.
Pros
- May be used to refinance: Doctor mortgage loans may be used to refinance a property you already own, as long as you are using it as your primary residence.
- No PMI: Physician mortgage loans don’t require private mortgage insurance, no matter your down payment amount.
- Lenient on student loan debt: Because physicians and other high-income earners often graduate with significant student loan debt, doctor mortgages are more lenient. Deferred student loan payments may be totally excluded from debt-to-income ratio calculations.
- Buy with an employment contract: Many mortgage lenders will allow medical professionals to use future-dated employment contracts as proof of earning potential––bypassing the employment requirements of conventional mortgage loans.
- Low down payment: Many doctor mortgage loans will allow borrowers to put down 0–5% of the home’s purchase price.
Cons
- Large monthly payments: Because physician mortgage loans don’t have conforming loan limits, it can be easier to borrow outside of your means by signing on for an overbearing mortgage payment.
- Primary residence requirements: Unlike conventional mortgages, doctor mortgage loans are typically restricted to the purchase or refinancing of a primary residence. In some cases, there will be restrictions on the type of property you’re able to purchase.
- Often adjustable-rate mortgages: A lot of mortgage lenders offset the risk of offering more lenient requirements by charging higher interest rates or structuring the loan as an ARM.
- Still required to pay closing costs: Even with 100% financing, borrowers will still need to have enough cash on hand to pay closing costs and meet cash reserve requirements.
Who is a Physician Loan in New Jersey Best For?
Seeing other medical professionals benefit from physician mortgage loans can help you decide if it’s the right home loan option for your financial situation.
We’ve prepared a few examples of the types of individuals who are likely to be a great fit for a physician mortgage loan in New Jersey. Take a look as you navigate the home-buying process.
Private practice owners
Private practice owners, especially in the early years, need to invest in their business to ensure it grows, expands, and self-sustains in the long term. But operating a private practice shouldn’t stop physicians, veterinarians, and dentists from purchasing a home they love or refinancing a home they already own with better terms.
Physician loans allow these small business operators to keep their money in the business while still investing in a home they love by lowering the down payment requirements.
While conventional loans will typically want a 3–20% down payment, physician loans offer financing at a lower down payment threshold.
Home buyers looking at all their mortgage options
While the name is misleading, physician mortgage loans aren’t exclusive to doctors. Many lenders will open physician mortgage loan programs to other high-earning professionals, including pilots, accountants, nurses, and lawyers.
If you’re a high-income earner looking to purchase or refinance your home in the future, a physician loan can offer advantageous terms, such as no PMI, low or no down payment, and accepting employment contracts before you start working.
Medical doctors hoping to refinance their primary residence
Physician mortgage loans aren’t just for purchasing a new home. If you already own your home and you hold a qualifying degree, a physician mortgage loan can help you refinance your existing mortgage with more favorable terms.
You can rate/term refinance, which allows you to secure a new mortgage with the current interest rate while extending the loan term.
Rate/term refinances can often lower your down payment to a more affordable price point, especially if you have an adjustable-rate mortgage with an increasing interest rate. You can even switch your financing structure to a fixed-rate mortgage if you qualify.
Cash-out refinances can help you to take out a loan against your home equity to pay off debt and make home improvements.
However, it’s important to note that most physician mortgage loans are designed for primary residences, which means they cannot be used to refinance a rental or investment property.
Recent graduates with minimal savings accounts and a lot of student loan debt
Recent medical school graduates have rarely had the opportunity to amass savings amid their years of training––often taking out hundreds of thousands of dollars in student loans just to make it through school. Both these circumstances can be significant barriers to securing a conventional loan, but physician mortgage loans are often willing to work with qualified borrowers.
Many physician mortgage loan programs will ignore student loans deferred for 12 months or more when calculating DTI ratio. Other programs will use the minimum monthly payment amount required by income-driven repayment plans.
Lenders are often willing to make these concessions because medical professionals are more likely to pay off their loans quickly and access
Frequently Asked Questions
What is the interest rate on a physician mortgage in New Jersey?
The interest rate on a physician mortgage in New Jersey fluctuates with the average interest rate across the country. Physician mortgages in general tend to have higher interest rates than conventional loans because the lender takes on additional risk by offering more lenient qualifying terms.
Interest rates are also highly personal and based on each borrower’s unique financial situation. You can check daily average interest rates or discuss with your loan officer after getting preapproved to have a better idea of what your rate will be when you lock.
What are the requirements for a physician loan in New Jersey?
The requirements for a physician loan in New Jersey will vary from lender to lender, but there are a few standard practices you can expect:
- Credit score of at least 700
- Active employment contract starting within 60-90 days of closing
- Small down payment and sufficient cash reserves
- DTI ratio of 50% or less
- Intent to purchase an owner-occupied primary residence
Is a physician loan the same as a conventional loan?
No, a physician loan is not the same as a conventional loan. A conventional loan will typically require at least a 3% down payment and at least two years of employment history to qualify whereas a physician loan is designed to meet the needs of early-career medical professionals.
In some cases, physicians can secure home loans with 100% financing and a future-dated employment contract. Physician loans are easier to qualify for than conventional loans if you hold a qualifying medical degree.
What credit score is needed for a doctor loan in New Jersey?
A minimum credit score of 700 is needed for a doctor loan in New Jersey. In some cases, lenders will work with lower credit when the borrower is able to put more money down. In other cases, a higher credit score––closer to 710 or 720––may be required for 100% financing.
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