Doctor loans have some pretty strict requirements in terms of what is needed to secure one. These loans are specially designed for residents and established doctors with unique financial situations. Newly-graduated medical school residents may be looking to obtain a mortgage for their first home or to refinance their current home loan. Unfortunately for many, this may not be possible. This is where doctor loans can give you an advantage.
The Credit Requirements
In order to be able to secure doctor loans, you are going to have to have a fairly respectable credit score. Your credit score is likely to be pulled from each of the three major credit bureaus. The middle or median score of the three is what will be used for the purpose of approval for doctor loans. In order to qualify for one of these loans, you need to have a minimum median score of 680. In some rare circumstances, based on your debt-to-income ratio, you may need to have a higher credit score than 680.
What if my score is not high enough?
You may still be eligible for doctor loans even if you do not have a high enough credit score right out of the gate. A banking officer is likely going to help you to go over your options for boosting your credit score to where it needs to be. You can do some work on your own to increase your credit score even before you apply. This could include paying down some outstanding credit card debt, paying all of your bills consistently and on time, and so on.
Getting a Re-score of Your Credit
You can have your credit score re-scored from time to time if you work with the proper provider of doctor loans. This type of re-score is going to allow your credit score to be pulled right away after you have made some tweaks to it. Raising your credit score just a bit in a short period of time can make all of the difference in being able to secure doctor loans versus having them be just out of reach due to a slightly-too-low credit score.
Start Preparing Early
In the event that you know you are going to be pursuing a doctor loan in the near future, get your finances together now. Check your credit score a year before you plan to apply so that you can see where you currently stand. This can give you an idea regarding the work you are going to have to do in order to increase your credit score over the following year so it will be at the necessary level when you send in your application.
Securing doctor loans is a great way to get a mortgage for that home you have been dreaming of. Medical school loans could prohibit a resident or established doctor from getting a fair loan with favorable interest rates and loan teams from a conventional bank or broker. Fortunately, for those who qualify, a fair loan is exactly what a doctor loan can provide you. Getting your credit score in order now can help be prepared for the application process down the line.