Q: What are the benefits of a doctors’ home loan?
- Lower deposit requirements
One of the biggest advantages of a doctor’s home loan is the lower deposit requirements. While most home loans require a deposit of at least 20% of the property value, some doctor’s home loans may require as little as 5% deposit. This can make it easier for you to buy a home, especially if you’re still paying off student loans or other debts.
- More flexible lending criteria
Doctors are generally considered low-risk borrowers by lenders due to their high earning potential and stable employment prospects. This means that some lenders may be more flexible with their lending criteria when assessing your eligibility for a doctor’s home loan. For example, they may take into account your future earnings potential rather than just your current income, which can help you qualify for a larger loan.
- No Lenders Mortgage Insurance (LMI)
Another benefit of a doctor’s home loan is that you may be able to avoid paying Lenders Mortgage Insurance (LMI). LMI is typically required for home loans with a deposit of less than 20% of the property value, and it can add thousands of dollars to the cost of your loan. However, some doctor’s home loans may waive LMI requirements altogether, which can save you a significant amount of money.
- Competitive interest rates
Doctor’s home loans may also offer competitive interest rates compared to other home loan options. Because these loans are designed specifically for medical professionals, lenders may be more willing to offer lower interest rates in order to attract and retain these high-value customers.
- Additional features and benefits
In addition to the above benefits, some doctor’s home loans may also offer additional features and benefits, such as:
- Flexible repayment options
- The ability to make extra repayments without penalty
- Interest-only repayments for a period of time
- Offset accounts to reduce interest costs
- Cashback or other rewards for borrowing with a particular lender