Doctors across the country routinely use physician loans to help them buy their first homes. Banks and mortgage lenders are happy to offer these programs, for a number of reasons.
By offering these special mortgage programs, lenders are able to proactively build relationships with high earners, a leg up that could lead to future investment management, insurance, or other cross-sold services.
One under the radar physician loan program is offered by Regions Bank. Here is everything you want to know about their program.
MD, DO, DDS, DMD
$1 million at 95% financing
Fixed rate terms
Adjustable rate terms
Regions Bank Doctor Mortgage Program
Regions Bank's physician mortgage program has some main differences when compared to others in the industry. Here's everything you need to know about the program's eligibility, loans, and special features.
Regions Bank's program is open to MDs, DOs, DMDs, and DDSs, but the program is also open to residents and fellows at the end of their training.
Those with one of these degrees must be a permanent resident of the United States, though. Visa holders are ineligible at this time.
Available to home buyers in Alabama, Arkansas, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Mississippi, Missouri, North Carolina, South Carolina, Tennessee, and Texas.
Regions does not advertise any maximum debt to income ratio to qualify and uses flexible underwriting criteria because the program is intended to help doctors with student loan debt buy homes.
And while borrowers will need to use the program to buy their primary residence, Regions does offer some flexibility in terms of the residence type. The loan can be used to purchase a single-family home, multi-family home, or condominium.
Loans and special features
Qualifying doctors may buy homes with no down payment (100% financing) up to $750,000 and 5% down up to $1 million.
These loans come with a number of perks and special features, like:
Zero private mortgage insurance (PMI)
The ability to close on your loan before you begin your employment
All of these perks are pretty standard in the physician mortgage space, but it is nice to see Regions Bank extend these perks nonetheless.
The lender does not publish any information regarding available fixed or adjustable-rate loan options, but it is fair to assume that borrowers will have a reasonable selection.
Pros to a Regions Bank physician loan
Though many of the perks offered by Regions are standard in the physician loan space, the program is still a good fit for:
Practitioners about to begin their careers
These home loans allow an opportunity for residents and fellows that haven't begun their careers yet to buy a home without substantial cash savings. This is particularly helpful for those relocating, as home ownership may be a more feasible option than renting, given the cash requirements to do so.
Dental and physician residents and fellows can close on a Regions Bank loan up to 90 days before they are set to begin their employment, so long as their start date is listed on an employment contract or offer letter.
Those with student loan debt only
Since your student loan debts will be treated with leniency in the underwriting process, those that owe $100,000 - or more - in student loans can still buy homes. Still, if you have this much outstanding debt, you shouldn't have any consumer or other types of debt.
These will increase the bank's risk in lending to you and could lead to you being rejected in underwriting.
When to skip the Regions Bank doctor loan
For many providers, physician home loans sound like a once in a lifetime opportunity to buy a first home. And they can be! But here are three circumstances where you should skip out on the Regions Bank doctor loan program.
1. You can get better terms elsewhere
You may not need the bells and whistles provided by Regions Bank's doctor loans. Maybe you aren't looking to buy a $1 million home. Or you don't have $100,000 in student loan debt.
No matter the reason, it is possible to find better terms elsewhere.
Don't be afraid to rate shop with multiple lenders, physician loan or not. It just doesn't make sense to pay for perks or features that don't matter to you.
2. You're looking to make a down payment
Physician loans are best known for offering low or no down payment options. But sometimes, qualifying doctors may have money saved and want to make a down payment to lower their mortgage payments.
If this describes you, then you may not need the Regions Bank program! Of course, you may still opt to participate if you find an attractive rate and term.
3. You're buying a home to rent in the future
Remember - Regions Bank physician mortgages need to be used to buy a home to serve as your primary residence. In a growing trend, though, many first-time home buyers are buying houses with the intent of living in them for 24-48 months.
Instead of selling these homes down the line, though, buyers are holding these homes to be used as rental properties, meaning the home is no longer your primary residence.
This strategy, while potentially advantageous for building wealth, could be against the rules and conditions for many physician loan programs.
Physician loan alternatives to Regions Bank
Just because the Regions Bank doctor loan isn't right for you doesn't mean that a physician loan isn't a good option for you.
Even if you're not offered a loan through the program, you may turn to one of Regions' competitors:
1. Huntington Bank
Huntington Bank offers physician loans to doctors and dentists but offers expanded eligibility to include veterinarians as well. Complete with higher loan limits of up to $2 million, Huntington Bank may be a better option for physicians living in costlier areas.
2. TD Bank
TD Bank is another option for physicians that are interested in a doctor loan but unsure whether Regions may be the right lender for them. Available to physicians, dentists, and podiatrists, TD's Medical Professional Mortgage allows borrowers to borrow up to $1 million with 100% financing and a maximum of $2 million with 89.99% financing.
3. BMO Bank
One more option for physicians is BMO Bank.
BMO offers a huge variety of loan terms for borrowers to consider, including:
10-, 15-, 20-, and 30-year fixed terms
10-, 15-, and 20-year ARMs
BMO also offers a 0.125% interest rate decrease for those that make their payments on autopay, which could save you thousands of dollars over the life of your loan.
Regions Bank offers a competitive physician mortgage program for doctors and dentists to consider when buying a home early in their careers.
And while not available nationwide, the program is a solid, but not spectacular, option for providers to consider. Still, it can help qualifying practitioners to buy a home years earlier than they otherwise may have been able to.
Would you consider a Regions Bank physician loan? Tell us why or why not in the comments below.
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