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  • Writer's pictureNathan Zarcaro

A Guide to the BMO Bank, N.A. Physician Mortgage Program

Updated: Dec 20, 2023


Physicians and other healthcare workers across the country have a number of physician loan programs to consider when they're ready to buy a home. These programs typically come with higher loan limits, increased financing, and additional flexibility.


BMO Bank offers a popular doctor loan program.


Here's a full guide to BMO Bank's (formerly BMO Harris) physician loan program.



BMO physician loan program

​Eligible professions

MD, DO, DMD, DDS

Maximum loan

​Up to $2 million at 100% financing

Fixed rate terms

​10-, 15-, 20- and 30-year

Adjustable rate terms

​10-, 15- and 20-year


BMO Bank details


BMO Bank, the Bank of Montreal, is one of Canada's most recognizable banks. A United States subsidiary, BMO Bank, N.A., is headquartered in Chicago, Illinois and offers traditional banking and financial services to Americans nationwide.


Now the 8th largest North American bank by assets, BMO is also known for its expanding doctor loan program.



BMO Bank physician mortgage overview


BMO Bank's physician mortgage program is held in high esteem in the home lending industry, and for good reason. Here is what you need to know about eligibility, the loans, and other special criteria.



Eligibility


BMO offers their physician mortgage program to those with the following degrees:


  • MD

  • DO

  • DDS

  • DMD


Though this means that the program is open to just physicians and dentists, at least at this time, the program is highly beneficial for those that qualify. Medical residents and fellows are eligible to participate as well.


BMO Bank offers the loan program to home buyers in every state except New York.



Loan amounts, financing, and terms


Participants in BMO Bank's program may borrow up to $2 million, which is available with 90% financing (no down payment requirement) for certain borrowers.


Those that need to borrow less than $2 million can receive up to 95% financing on homes up to $1.5 million.


These borrowers must be within 10 years from the end of their residency/fellowship and be buying a home to serve as their primary residence. Borrowers more than 10 years removed from the end of their residency/fellowship may still be eligible but will only be able to finance a maximum of 89.99% of their home purchase.


BMO Bank also offers a number of different loan terms, including:


  • 10-, 15-, 20-, and 30-year fixed terms

  • 10-, 15-, and 20-year ARMs



Special perks/features


Those that use BMO's program may also receive a number of other perks, like:


  1. A 0.125% interest rate decrease for making payments on auto-pay

  2. The ability to use the program on a home refinance

  3. The ability to buy a single-family home, duplex, condominium, or townhome

  4. Closing on a loan up to 90 days before your employment officially begins

  5. Flexible debt-to-income underwriting requirements, meaning that your student debt won't prevent you from buying a home

  6. No demonstrated income history requirements (helpful for doctors that have been in medical school)


Some of these perks, such as flexible DTI requirements, are pretty common amongst doctor home loan programs, while others, like using the program on a refinance, are rarer finds.



Who is the BMO doctor loan right for?


The Bank of Montreal's physician mortgage may be perfect for three types of borrowers:


  • Those that live in states with expensive real estate

  • Those without a down payment saved

  • Those that want to buy a house and save at the same time



1. Those that live in states with expensive real estate


These days, homes are expensive nationwide. Still, New England, the west coast, and states like Colorado and Utah tend to have home prices even pricier than the rest of the country.


Home buyers in these states will find the BMO doctor loan program especially useful given the $2 million loan limit, which will help them to afford a home in and around expensive city centers where they are likely to work.



2. Those without a down payment saved


We already mentioned that qualifying physicians and dentists may borrow up to $2 million with 100% financing, meaning no down payment is required. This is not a guarantee, and since BMO does not release much information on their underwriting criteria, it can be difficult to know if you'd qualify for not.


Still, borrowers with solid credit and good, stable income are most likely to qualify.



3. Buy a home and save at the same time


In our opinion, the most valuable part of the BMO physician mortgage is the ability to buy a home and save money at the same time.

Doctors have more cash flow than those working most all other careers. This excess cash flow means that doctors can typically afford the higher mortgage payments that result from a lower down payment, even if still repaying student loans.


And instead of making a down payment as large as you may need with a Conventional mortgage, a BMO physician mortgage can help you to invest any extra cash that you have saved.


In many cases, the extra time you'll be able to have this money invested for can benefit you greatly! Let's say that, instead of putting a $50,000 down payment on your home, you invest $25,000 for the future and save the other $25,000 in short term cash as an emergency fund.


Investing this $25,000 could leave you with an extra $331,692 in thirty years, if you're able to earn a 9% rate of return per year. At this point, higher mortgage payments may be worth it!



Pair a BMO doctor loan with closing cost assistance


Some healthcare providers can further limit the cost to get into their new home by pursuing closing cost assistance in their state.


These programs, typically reserved for first-time home buyers, vary in both scope and size across states, so it is hard to estimate just how much additional money you may be able to save.


Additionally, some states have maximum income requirements and mandate that you participate in certain state (non-physician loan) programs to qualify. But this is also far from a given. Ultimately, it really depends on where you live, but it can't hurt to ask your mortgage lender what your options are.



Our physician loan calculator


Use our physician mortgage calculator to help you decide whether BMO's program may be right for you!


Just estimate your home purchase price, down payment (however large or small you want), and interest rate, and see what your projected monthly payments look like.


We've even included space for you to estimate your property taxes and homeowner's insurance so that you can get a holistic view at what you can truly expect to pay each month!



Conclusion


Physicians and dentists looking to buy a home with student loan debt ought to consider BMO Bank's physician mortgage program. The combination of financing, relaxed underwriting requirements, and presence in every state except New York may make BMO's doctor loan the perfect fit for your home purchase.


What questions/comments do you have?


Tell us in the comments below!



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About Nathan Zarcaro

Nathan Zarcaro is the founder of The Student Debt Destroyer and is passionate about personal finance related causes.  A 2018 graduate of Providence College's Liberal Arts Honors Program, Nathan studied Finance, and has worked for industry leaders in both finance and healthcare.  In his free time, Nathan enjoys playing golf and traveling with his wife Brigid.

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