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Home Loans for Doctors: Applying Using a Mortgage Broker

As a doctor, applying for a home loan is slightly more demanding than a standard mortgage. You end up feeling confused in the specialised terms, eligibility criteria, and specific documentation. Particularly in the specialised loan options available to you. 

If you are applying for home loans for doctors—or as we call it “doctor loans” or “medico loans” with irregular income or limited financial history, it is time to think of a mortgage broker. 

A broker simplifies the process, ensures you find the suitable loan option, and negotiates better terms. In this blog, you will walk through the steps of applying for a home loan as a doctor and realise the benefits of a mortgage broker. So, keep reading the blog till the end. 

Understanding Home Loans for Doctors

To apply for a doctor loan, it is wise to acknowledge and understand the terms associated with it. Doctor loans typically offer:

- Higher Loan-to-Value Ratio (LVR):

It is a key metric to assess the risk of a home loan. It is the ratio of the loan amount to the appraised value of the property.

If your property’s worth is $700,000 and you are applying for a loan of $600,000, it means your LVR is close to 85%. Lenders consider loans with higher LVR to be riskier and will ask for Lenders Mortgage Insurance (LMI). 

But in the case of a doctor's loan, lenders offer up to 90-95% LVR. This helps you to borrow more of the property’s value without paying Lenders Mortgage Insurance (LMI).

- Discounted Interest Rates

Doctors are also entitled to discounts on home loan interest rates as part of medico packages.

- Flexible Loan Terms

Home loans for doctors help you to get flexible terms, eliminating the fixed repayment cycles. It accommodates the unique financial situation of medical professionals. 

- No LMI

In standard mortgages, you are required to pay insurance to the lender for borrowing loans of more than 80% of the property’s value. In a medico loan, you do not need to pay LMI.

While these features of a medico loan are attractive, it can be overwhelming to understand the different loan options and find the right deal for your circumstances.

Why Should You Use a Mortgage Broker?

A mortgage broker is a middle man between you and various lenders. He directs you to the best lender to secure the right home loan deal. Here are a few ways to understand their expertise.  

Expert Guidance in Loan Comparison

Apart from providing access to home loans for doctors, a mortgage broker helps you to choose the right loan option.

- Compare Loan Features

A broker analyse different home loan options on the basis of your interest rates, repayment rates, and special conditions. 

- Help You Understand Loan Terms

A mortgage broker explains complex terms such as comparison rates, offset accounts, and redraw facilities. This ensures you understand exactly what you're agreeing to.

- Advocate for You

Brokers are familiar with lender policies, negotiate better terms, or secure discounts that are otherwise difficult to get.

Streamlined Application Process

Applying for home loans for doctors means extensive paperwork. A mortgage broker helps in following ways:

- Coordinate the Paperwork

Brokers guide you in gathering all necessary documentation, such as identification, proof of employment, tax returns, and your registration certificate.

- Handle the Lender's Requirements

Lenders ask for proof of professional registration with AHPRA or other relevant bodies. Brokers ensure to review your documents along with the proof of income payslips to confirm your financial stability. 

- Submit Your Application

Brokers handle the submission process, starting right from completing your application process to submitting all the forms to the lenders. This ensures timely approval and streamlined process of acquiring a good deal. 

Navigating Complex Situations

Doctors, particularly self-employed ones or those who are in the beginning of their career, may face challenges when applying for home loans for doctors. A broker can assist with:

- Complex Income Structures

For doctors with irregular income, a broker helps find lenders who are willing to work with these circumstances.

- Self-Employed Doctors

If you are self-employed, brokers present your financials in the best light and secure a loan.

- Dealing with HECS-HELP Debt

Many doctors have student loans, and brokers know how to manage these when applying for a loan. They can help you find lenders who are more flexible regarding HECS-HELP debt.

Documentation Required 

Once your broker understands your needs, they’ll assist you in gathering the required documentation, including:

  • Identification: Passport, driver’s license, or other ID.

  • Employment Proof: Recent payslips or locum contracts.

  • Tax Returns: For self-employed doctors, two years’ worth of financials or one year with solid projections.

  • Professional Registration: Proof of your registration with AHPRA or relevant bodies.

  • HECS-HELP Documentation: If applicable, details of your student debt.

Final Words

We hope you found this blog useful. As you see, home loans for doctors are an ideal solution to get perks like higher borrowing power and tailored loan packages. However, applying for a medico loan on your own is pretty overwhelming.  

With a mortgage broker, you can get guidance on the application process, and help you secure the best deal possible. With a broker from Axton Finance, you not only save time and effort but also ensure that your financial interests are fully considered. Whether you’re a new doctor, a specialist, or self-employed, their brokers are highly credible and hold expertise in achieving your homeownership goals with ease.

author

Chris Bates

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