Buying a home...after residency

[Bostonredsox]

Looking for some advice (more recent than prior posts) on buying a home at end of residency. Sort of unique situation. Finishing residency in the south in 17 months. Looking to buy a home back in home state in the northeast at end of residency. Married with several school-age kids. Want to buy house next april-ish (2014) so I can move the wife and kids home right after residency ends in july-august, in time for school end of august. Not sure how to go about getting morgate info and such now. I have an attending contract already signed so my income is solid to give to the bank starting july 1, 2014, just not sure about having down payment and such ready by july first, or if it will be necessarry. Have heard a bit about physicianLoans, sent them contact info, have not heard back. Anyone with some good experiences to share?

---

Members don't see this ad.

 

[45408]

Why the rush to buy a house? What if you don't like the job or the local schools?

I plan to rent for a year or two when I start my first job, to try the job/area/schools out.

 

[Smurfette]

Moving to Finance/Investment forum

 

[Bostonredsox]

The area we are moving to is where we are from. We have both lived there for 25 years prior to relocating for residency. All of our family is there. I have also worked in the majority of the hospitals in that location and I like several of them. As for buying a home, we rent a home now. And at 30, renting with 5kids and a 90 pound lab has gotten quite old. We would like to buy our house, get our kids into their permanent school, (which we already no quite a bit about, as we are from the area) and start living our lives.

 

[Impromptu]

You've already been living your life, but a slightly larger paycheck may make it a different phase. I will be moving soon, too. My wife and I would like to buy a house, but we are going to go the conservative route and rent for a while until we get to know the area better and decide we want to set down roots, which is different than your situation.

I recommend Zillow.com. You and the rest of the world likely know about that website, but in case there are a few people who don't know, you can check out practically every house for sale in an area, with pictures and lots of information about that house, prices of neighboring houses, and even where you currently live. I learned that my rental house was built in 1879.

Ask your bank about doctor loans. Not every bank offers them anymore. From what I understand they are typically zero down payment, but also allow for no mortgage insurance (PMI) which people typically are required to pay when they have a small down-payment. That will save you a bit of money. But the downside is higher interest rates. There are a few good websites that go step by step through the home buying process, along with the pros and cons of different options.

 

[Bostonredsox]

Yeah I have heard of zillow, and thats more or less what I am looking for. A bank that can provide the doctors loan and can go over with me what monthly morgatepayments are reasonable % of my projected income, essentially how much house is ok for me to look to buy, whether or not I will need a down payment and if so how much. Was wondering what other websites/companies people recommend.

 

[dynx]

Dear god.
Here's the best advice you'll get on this subject: as suggested above, rent in the area first. Figure out what your take home pay is actually going to be after taxes and expenses in that area. Then sit down with a friend or family member (preferably one that has thier financial **** together and actually knows how to spell mortgage) and figure out yourself what you can afford to pay each month. The bank/mortgage officer isn't in it to help you decide what's financially best for you. They want the biggest cut of the largest amount they can squeez out of you without you defaulting... And the mortgage officer doesn't even give a damn if you default.
You clearly dont know what you're doing. I'm not saying that to be mean its just glaringly obvious from your posts. You don't learn how to make one of the biggest purchases of your life from someone that makes a cut of your money.
Rent for at least 6 months. You'll thank me.

 

[Bostonredsox]

Dear god.
Here's the best advice you'll get on this subject: as suggested above, rent in the area first. Figure out what your take home pay is actually going to be after taxes and expenses in that area. Then sit down with a friend or family member (preferably one that has thier financial **** together and actually knows how to spell mortgage) and figure out yourself what you can afford to pay each month. The bank/mortgage officer isn't in it to help you decide what's financially best for you. They want the biggest cut of the largest amount they can squeez out of you without you defaulting... And the mortgage officer doesn't even give a damn if you default.
You clearly dont know what you're doing. I'm not saying that to be mean its just glaringly obvious from your posts. You don't learn how to make one of the biggest purchases of your life from someone that makes a cut of your money.
Rent for at least 6 months. You'll thank me.

I have owned 2 houses before. Acutally have pretty solid experience with both as i sold both for a profit despite them being in areas where the market was not in a very good state. And I will be working in my current state and commuting on my off weeks back home to the family. Obviously, i am trying to calculate out my student loan rates and estimate my taxes now, before I purchase the house, so that i can roughly know what I will have to work with in terms of monthly take home pay, to avoid moving twice in 6 months. The, just rent for 6 months then buy and move again idea works great, until you have to cram your family of 7 and all of your possesions into an apt for 6 months then find time to move it all again soon thereafter, as you wont be able to find a house to rent for only 6 months committment time. On top of that you are then trying to move with 5 small children in what will be nearing the dead of winter in upstate NY. And I was thinking more along the lines of a financial consultant not the morgate broker or bank rep who is selling me the house. Didnt think I had to explain that. Sorry for the confusion.

it is all different this time around. 5x the income I had then however now the student loans will factor in so the how much house you can buy with what type of loan and down payment numbers for x given salary have changed. Physicians purchasing houses is not the same as the general public, hence the request for advise on recommendations for financial consultants.

 

[dynx]

You bought and sold 2 houses for a profit before 30 even with loan and broker fees? You say you want a bank to go over the loan and how much you can afford yet you're suprised that you had to clarify that you weren't going to take advice from the bank? You've bought 2 houses but you're not sure if you'll need a down payment by July for the house you want to buy in April?
Yeah, you've clearly got this handled. Good luck

 

[Bostonredsox]

You bought and sold 2 houses for a profit before 30 even with loan and broker fees? You say you want a bank to go over the loan and how much you can afford yet you're suprised that you had to clarify that you weren't going to take advice from the bank? You've bought 2 houses but you're not sure if you'll need a down payment by July for the house you want to buy in April?
Yeah, you've clearly got this handled. Good luck

Some of us are a bit more accomplished then others at the same age.

Correct. We put close to 15k into each house and sold them for closer to 35k more than we purchased them for.

And yes, we would be purchasing in april-may, with expected 45-60 days to close we wouldnt need the downpayment, if at all, until july.

The first two houses we owned werent purchased when I was a physican, thus they did not go through physicanloans or a similar company. From what I have read, physicians are often exempt from downpayments and PMI when using these companies. Our first two homes were 75-90k homes in rural NY. Easy to fix them up and sell them for more. I am now talking about purchasing a 350-400k home as a physician. So yes, I am expecting the game to be quite a bit different and was thus asking for input from those who have done so. If the only thing you have to contribute in this forum are insults please dont post so I can actually see what other people have to say.

 

[dynx]

Rent

 

[Socrates25]

Why the rush to buy a house? What if you don't like the job or the local schools?

I plan to rent for a year or two when I start my first job, to try the job/area/schools out.

Mortgage rates are the lowest they have been in 50 years. This is truly a historic opportunity in terms of financing a house.

I've seen offers for rates as low as 3.1%

I do think it is prudent to wait 2-3 months after starting a new attending job and schools, but after that I would buy ASAP

 

[Socrates25]

Ask your bank about doctor loans. Not every bank offers them anymore. From what I understand they are typically zero down payment, but also allow for no mortgage insurance (PMI) which people typically are required to pay when they have a small down-payment. That will save you a bit of money. But the downside is higher interest rates. There are a few good websites that go step by step through the home buying process, along with the pros and cons of different options.

Most of the doctor loan programs have gone away but there are still a few left.

BoA -- they require 5% down payment (used to be zero down)
SunTrust
Physician loans.com -- offers 0 down and no PMI with credit score > 700

 

[Bostonredsox]

Most of the doctor loan programs have gone away but there are still a few left.

BoA -- they require 5% down payment (used to be zero down)
SunTrust
Physician loans.com -- offers 0 down and no PMI with credit score > 700

Thank you this is what I have found so far. BoA wants 700 optimally 720 and 5% down. I have a bonus coming towards the end of residency which would be 5% on 400,000. Not a fan of BoA but that looks like the road I will need to take. Current credit score is like 670 so I need to get it up a tad bit in the next 12 months but as I just received a bonus I have a couple of old credit cards I am going to pay off and reduce the debt:income ratio which I am hoping will do the trick.

 

[dpmd]

I would advise going with the cheapest home you can fit your family in (in an acceptable neighborhood of course). You may know the area and be sure you want to live there always, but what happens if you hate your job or if they end up hating you? What if your employer can't afford to keep you on? What if you injure yourself and can't work? Just because you have a contract for X amount of money (presumably for a limited time like a year) doesn't mean you will keep getting that much in the future. Having a large mortgage can lock you into a situation you don't like.

There are plenty of calculators out there that can show you how big a mortgage you could cover based on your income. Many of them allow you to include other debt payments. Should be a good starting point.

I can't comment on physician loans since I didn't use one (had enough of a down payment to avoid the need for it). You have to calculate whether the higher interest rate is justified by avoiding PMI.

 

[Bostonredsox]

I would advise going with the cheapest home you can fit your family in (in an acceptable neighborhood of course). You may know the area and be sure you want to live there always, but what happens if you hate your job or if they end up hating you? What if your employer can't afford to keep you on? What if you injure yourself and can't work? Just because you have a contract for X amount of money (presumably for a limited time like a year) doesn't mean you will keep getting that much in the future. Having a large mortgage can lock you into a situation you don't like.

There are plenty of calculators out there that can show you how big a mortgage you could cover based on your income. Many of them allow you to include other debt payments. Should be a good starting point.

I can't comment on physician loans since I didn't use one (had enough of a down payment to avoid the need for it). You have to calculate whether the higher interest rate is justified by avoiding PMI.

Contract is for 2 years and I can extend it to 4 should I choose too. I see what you are saying. I do not want to be "house broke" I have a pretty good idea what my technical mortgage limit for my salary is, just would like to see it compared with loans and other bills, plus need to see what xdollar house would be in monthly payments. That way I can come up with what I should set as max mortgage payment so I can have X income left over for other calculated expenses and savings.

 

[The White Coat Investor]

I agree with advice above about renting for 3-6 months. Not only does it give you a chance to make sure you like the job (many people change jobs in the first year or two out of residency) but it also allows you to save up some cash and most importantly, be a predatory buyer. Buying in October, November, December the slowest time of year may save you far more than you'll pay down the mortgage (and save on taxes) by buying in July.

More info on doctor loans can be found on my website:

http://whitecoatinvestor.com/personal-finance/the-doctor-mortgage-loan/

 

[DocProtector]

Renting a home that you are thinking about buying has saved a number of my clients. If the house you are considering buying has been on the market for some time, then they will likely rent to you. During that time you are renting the home will reveal all the headaches not previously disclosed...

 

[Bostonredsox]

We have a similar goal, saving money to purchase a home while still preserving cash for post closing.
I saw on SDN a few Ads and have heard great things about Fifth Third Bank. Tried to click on their sponsor link so I could be referred to a specialist, but hyper did not work. Researched a little further with a few Fellows in my department, and was referred to a national representative that is providing me with 0% down on a condo venture we're looking at.

Email - [email protected]

So far, things progressing well and should be able to buy my place with little to no money out of my slim savings and payment affordable largely due to the mortgage insurance not present in payment.
Best wishes to you - at least you have a reliable contact now.

Thanks man ill see if they're available in New York

 

[53PhysicianLend]

Thanks man ill see if they're available in New York

Sorry, NY is out of the footprint. We only lend this product in OH,KY,WI,MI,MO,IL,PA,WV,TN,GA,FL,SC,AL,IN and NC

 

[UTPhysicianLoan]

Thanks man ill see if they're available in New York

We'd love to help, but we aren't in New York yet.
Check out these guys and see if they can help you.
Residential Home Funding Corp http://www.mortgagesforchampions.com/our-champions/doctors-nurses/
Good luck!