If you’ve been considering a physician mortgage loan in Alaska, getting connected with a knowledgeable mortgage provider can help you through the entire physician loan process.
With nearly 2,000 physicians and only roughly 732,000 residents, Alaskan medical professionals will face unique obstacles and complex circumstances throughout their careers.
Alaska is more than vast tracts of land and mountains and oceans. For physicians, it means practicing medicine in a state with a rich history, diverse ethnic groups, and challenging wilderness.
Whether you’re beginning your career as a new doctor, opening a private practice, or moving back home, the best physician mortgage loans in Alaska can ensure you have the confidence to embark on this next step in your life and career.
4 Best Alaska Physician Home Loan Lenders
Here are the top physician mortgage loan lenders in AK:
Discover The Best Lenders in Alaska 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. Bank of America
- BBB Grade: A+
- JD Power Score: 628
Bank of America offers specialized doctor mortgage loans for licensed and practiced medical professionals in Alaska. Borrowers must be actively practicing and hold one of the following medical designations:
- MD
- DDS
- DMD
- DPM
- DO
- OD (Optometrist)
Medical residents and fellows are also eligible. Borrowers who have yet to begin their first jobs can use their employment contract for income verification, but new employment must begin within 90 days of closing.
The program will require four to six months of cash reserves, depending on the loan amount. Student loan debt is handled on a case-by-case basis but the lender advertises that underwriters can often exclude it from DTI calculations.
Borrowers can qualify for the following down payment options, all of which exclude PMI:
- 3% down payment on loans up to $850,000
- 5% down payment on loans up to $1 million
- 10% down payment on loans up to $1.5 million
- 15% down payment on loans up to $2 million
Borrowers should have a 700 minimum credit score to secure Bank of America’s competitive interest rates and favorable loan terms.
All borrowers will be required to hold or open a Bank of America checking or savings account to qualify for the program.
Variable and fixed-rate mortgage products are available.
2. Flagstar Bank
- BBB Grade: NR
- JD Power Score: 625
Flagstar Bank offers one of the more inclusive physician loan programs on the market. It reaches outside the normal parameters of healthcare professional loans and includes other high-income earner professionals.
The following degrees are eligible for Flagstar Bank’s Professional Loan Program:
- Medical Resident (Educational License)
- Medical Doctor (MD)
- Doctor of Dental Surgery (DDS)
- Doctor of Dental Medicine (DMD)
- Doctor of Optometry (OD)
- Doctor of Ophthalmology (MD)
- Doctor of Pharmacy (PharmD/RPH)
- Doctor of Podiatric Medicine (DPM)
- Doctor of Osteopathy (DO)
- Physician Assistant (PA)
- Registered Nurse (RN)
- Nurse Anesthetist (CRNA)
- Nurse Practitioner (NP)
- Clinical Nurse Specialist
- ATP Pilot
- Certified Public Accountant (CPA)
- Attorney (JD)
- Veterinarian (DVM)
All borrowers must be within the first 10 years of their career to qualify. Borrowers with a 720 minimum credit score are eligible for loan programs up to $1 million with no money down.
There are other low down payment options on loans up to $1.5 million. PMI requirements are waived at every down payment amount through this program.
The program does have cash reserve requirements, but interested party contributions can be applied toward these requirements or any outstanding down payment.
Unlike some of the other loan programs on this list, Flagstar Bank’s Professional Loan Program only offers adjustable-rate mortgage products. Fixed-rate doctor loans are not available.
However, all adjustable-rate mortgage products begin with an introductory fixed rate of interest. Borrowers can choose an initial fixed-rate period of 60, 84, or 120 months before the rate resets.
3. KeyBank
- BBB Grade: A+
- JD Power Score: 635
KeyBank’s Medical Professional Mortgage Program is open to actively practicing interns, residents, fellows, clinical professors, researchers, doctors, and dentists within the following designations:
- MD
- DO
- DPM
- DDS
- DMD
The program offers a very generous maximum loan amount of $3.5 million with up to 95% loan-to-value, which means borrowers can qualify with as little as 5% down. PMI is not required.
Fixed and variable interest rate products are available. Loans may be used to purchase a new home or refinance an existing primary residence. Rate/term and cash-out refinancing options are available.
Eligible property types include attached or detached one-unit single-family homes, condos, and planned unit developments.
KeyBank’s dedicated loan officers will provide a personalized and thorough experience so borrowers have resources to lean on throughout every step of the home-buying process.
4. U.S. Bank
- BBB Grade: A-
- JD Power Score: 667
U.S. Bank opens its physician mortgage program to residents, fellows, medical doctors, and doctors of osteopathic medicine. Borrowers must have a 710 minimum credit score to qualify.
The program has a maximum loan amount of $2.5 million. PMI is not required, but down payment amounts will vary. Loans up to $1 million require a 5% down payment whereas loans up to $1.5 million require a slightly larger down payment of 10%. Loans up to $2 million will require at least 15% down.
U.S. Bank doesn’t exclude student loan debt from DTI calculations. Instead, it will use 2% of the total loan balance for borrowers in deferment.
How Physician Mortgage Loans Work in Alaska
In general, Alaska has a higher cost of living than the 48 contiguous United States. For this reason, it has higher conforming loan limits and FHA loan allowances compared to counties in other parts of the country.
More Buying Power
In Alaska, conforming loans are capped at $1,089,300 and FHA loan limits range from $472,030 to $586,500 depending on the county. Physician mortgages can expand the buying power of qualified borrowers––making them more able to place competitive offers in strong markets.
Low Down Payments
In addition to the generous loan sums, physician loan programs can reduce many of the upfront costs of purchasing a home.
While a conventional mortgage may allow borrowers to put down as little as 3% of their home’s purchase price, it will require PMI until the borrower reaches 20% equity.
Physician mortgage loans waive this requirement––saving borrowers thousands over the life of the loan––regardless of the down payment amount.
It’s important to note that down payment requirements may be reduced compared to a conventional loan, but borrowers will often need to demonstrate sufficient savings to cover closing costs and any cash reserve requirements.
Cash reserve requirements can range from enough funds for three months of expenses to as much as 12 months of expenses, depending on the loan amount.
Lenient with Student Loan Debt
Physician mortgage loan underwriters are particularly lenient on student loan debt, which is one of the most significant barriers for medical professionals trying to purchase a home.
Student loan payments deferred for 12 months or more after closing are the most likely to be excluded from DTI ratio calculations, but it’s not the only option. Borrowers on an income-driven repayment plan may use their reduced monthly payments for DTI calculations.
In some other cases, underwriting may use 2% of the total loan balance when calculating the DTI ratio.
Lenient with Income History
Physician loans can also be a valuable tool for early-career medical professionals who don’t have the income history to qualify for a conventional mortgage. Medical residents and new doctors relocating for a job can use a signed employment contract dated within 60–90 days of closing as income verification.
Restricted to Primary Residence
Physician mortgage loans are restricted to owner-occupied primary residences in most cases. In other words, this type of financing is only available for the purchase or refinance of a property you currently live in full-time or intend to live in full-time. In this way, they are more restrictive than conventional mortgages.
On top of that, each physician mortgage lender reserves the right to determine eligible properties. Typically, single-family residences, condos, and townhouses are included, but you’ll want to discuss your options with a loan officer.
Credit Score Requirements
We recommend that borrowers have a 700 minimum credit score to qualify for a variety of physician mortgage loans in Alaska.
In general, the better your credit score, the more likely you are to access 100% financing options. Some lenders may work with lower credit scores if you can afford a larger down payment.
There aren’t standard eligibility requirements. If you don’t meet the qualifications for one program, we recommend shopping around. Some physician mortgage programs are more inclusive of a variety of healthcare professionals.
Pros and Cons
Weighing the pros and cons is an important part of any borrower’s due diligence in the home-buying process.
We’ve prepared a few notable advantages and disadvantages of doctor mortgage programs as a whole so you can choose the best physician mortgage loan in Alaska for your financial situation.
Consider the following while shopping for a loan program in Alaska:
Pros
- Can be used to refinance: Physician mortgage loans aren’t just for the purchase of a new home; borrowers may also use them to rate/term or cash-out refinance a property they already own.
- No private mortgage insurance: Doctor mortgage lenders don’t require PMI even when borrowers put in less than a 20% down payment.
- Higher loan limits: Physician loans aren’t held to conforming loan limits, so they can extend more generous mortgage sums.
- Buy before your start date: Borrowers who have yet to start working can use a future-dated employment contract for their income verification.
- Open to residents and new doctors: Physician mortgage lenders include residents and new doctors who have recently earned their licenses.
- Low down payment options: Doctor mortgage loans provide 85–100% financing to qualified borrowers. Depending on the loan amount, borrowers can qualify for zero-money-down home loans.
- Flexible DTI underwriting: Physician mortgage underwriters are flexible on student loan debt, often excluding it from debt-to-income ratio calculations, which can make it easier to qualify.
- Variety of qualifying healthcare professionals: Physician mortgage loan programs are generally open to physicians and dentists, but some programs go even further by including other high-income earning healthcare professionals.
- Guided home-buying process: Physician loan officers are trained in the complex needs of medical professionals. They’ll guide borrowers through the process by explaining the ins and outs of mortgage requirements and ensuring the right documentation is gathered.
Cons
- Age limits: Many physician mortgage loans are reserved for medical professionals who have completed residency in the last 10 years.
- Higher interest rates: In some cases, physician mortgage loans can have higher interest rates than conventional loans of the same amount. Some physician mortgage loans can only be structured as adjustable-rate mortgages which means the interest rate will change over time. Borrowers can access lower interest rates by putting more money down or prepaying points.
- Higher minimum credit score: Because physician loans are more lax with some requirements they tend to have a stricter credit approval process. In general, a 700 minimum credit score is a good place to start to ensure favorable loan terms.
- Primary residence restrictions: Physician mortgage loans are typically limited to the purchase or refinance of an owner-occupied primary residence; investment properties and second homes are rarely included.
- Large monthly payment: Due to the small down payment and large loan amount, physician mortgage payments can be substantial. It’s important to be thoughtful about the monthly payment you can reasonably afford for the life of the loan.
- Closing costs and cash reserves: Despite providing competitive financing options with low (and even no) down payment, physician mortgages will still have cash reserve requirements to cover closing costs and other debt obligations.
Frequently Asked Questions
Is a physician loan in Alaska the same as a conventional loan?
No, a physician loan is not the same as a conventional loan. A physician loan is a specialized mortgage program geared toward physicians, dentists, and other medical professionals. Physician loans generally offer lower down payment requirements with waived PMI and flexible debt-to-income ratio calculations.
A conventional loan is the most common mortgage product in the country. A conventional loan requires a 3–20% down payment, private mortgage insurance, and a DTI ratio of 43% or less, which can be difficult for early-career medical professionals to meet.
Who qualifies for a physician mortgage loan in Alaska?
Every physician mortgage lender in Alaska will have its own list of eligible medical professionals, so it’s a good idea to discuss your options with a loan officer.
Residents, fellows, medical doctors, and doctors of osteopathic medicine are the most likely to be included in physician loan programs, but some programs are more inclusive than others.
Some physician loan programs include other healthcare professionals, such as dentists, veterinarians, nurse practitioners, physician assistants, nurse anesthetists, clinical nurse specialists, and other high-income earners.
What is the average physician mortgage loan amount in Alaska?
The average physician mortgage amount is fluid and ever-changing. In general, physician mortgage loans in Alaska offer 100% financing on loans up to $750,000, but there are often low down payment options on loans up to $1.5 million.
Your maximum loan amount will be determined based on your income and credit profile. You can get pre-approved by any mortgage lender at no cost.
Are physician loans in Alaska a good idea?
Physician loans are a good idea for medical professionals with excellent credit, high earning potential, and the desire to purchase or refinance an owner-occupied primary residence.
Choosing a physician mortgage loan can help medical professionals purchase a home early on in their careers without waiting to meet the requirements of a conventional mortgage.
Physician loans offer low down payment options and significant loan sums which can lead to large monthly payments that can monopolize much of the household income until you reach your full earning potential.
Good loan officers will be honest about the best mortgage program for your needs. It’s important to work with lenders you trust, so you can feel confident in your decision.
Do physician loans in Alaska have PMI?
No, physician loans do not have PMI requirements. For conventional loans, PMI ranges from 0.22% to 2.25% of the original loan amount spread out over each year of the loan term. In general, the larger your mortgage the larger your PMI payments will be.
Choosing a physician loan program saves borrowers this expense, allowing them to devote those funds to other goals.
Who is a Physician Loan in Alaska Best For?
Physician mortgage loans can be excellent financing options for borrowers who may otherwise be overburdened with the demands of conventional mortgage programs. We’ve prepared a few example scenarios in which people stand to benefit a lot from the terms of physician home loans in Alaska.
If you identify with any of the below examples, you may be a strong fit for a physician mortgage loan.
1. Dentist or veterinarian who owns a private practice
Private practices have substantial start-up and operating costs, especially during the first few years. If you are a dentist, veterinarian, or primary care physician who owns a private practice, it may make more sense to invest money back into the business than into your personal savings.
While private practices are likely to have significant returns as they grow, this investment can detract from the ability to save for a down payment in the early days of operation.
Physician mortgage loan programs have low down payment options, which can allow private practice owners to continue investing in their businesses without sacrificing their dream homes.
2. Borrowers investing in the stock market
Similar to private practice, playing the stock market is an investment that requires consistency and patience. Growing your investments in the stock market can also take away from saving for a sizable down payment.
Physician mortgage loans have the added benefit of not requiring PMI after you close on the home, which can also free up funds for ongoing investment.
3. Medical professionals with excellent credit scores
Physician loans aren’t always exclusive to doctors. High-income earners with an advanced degree with a minimum credit score of 700 are in a great position to qualify for physician mortgage loans.
Shopping for different loan programs, especially with a great credit profile, is a prudent method for securing the most loan terms and interest rates.
4. Recent medical school graduates with high student loan debt
It’s no secret that medical school is expensive. Many students have to take on significant student loan debt to afford the cost of their education. With the average student loan debt for medical school being about $200,000, many early-career medical professionals can find themselves marginalized from the home-buying process.
By excluding some or all of this debt, physician loan programs are more inclusive of early career interns, residents, fellows, and other new doctors who want to own a home.
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