Ryan Mandley · Physician Loan Specialist · NMLS #1181993
Moving for a new attending job usually means arriving in a new city with no pay stubs from the employer that is about to pay you. A conventional lender wants to see you on the job first. A physician loan does not.
The rule: up to 150 days
On this program, a fully executed employment contract or offer letter can be used to qualify with a start date up to 150 days after closing. That is about five months, comfortably covering the stretch between finishing training in June and starting work in the fall.
Most physician programs allow 60 or 90 days. The extra room matters when you are trying to buy during a visit in spring rather than in a rush in August.
Exception: if you are a 1099 or contracted physician rather than a W-2 employee, the start date must fall within 60 days of closing.
What the contract must say
- Your title, your start date, and your compensation.
- It must be signed by both sides. An unsigned draft or a verbal offer does not count.
- The only contingencies allowed are receiving your medical license or routine items like a background check, drug screen or fingerprinting. A contract contingent on something else, such as credentialing at a specific hospital or a minimum patient volume, can be a problem. Send it to me before you sign if you can.
The reserve rule that trips people up
This is the requirement most likely to surprise you at the last minute, so plan for it from the start.
If you close before your job starts, you need one extra month of full mortgage payment in reserves for every month between your first payment and your start date, on top of the program's normal reserve requirement.
Example: your first payment is due in August and you start in November. That is three months of gap, so three extra months of payments need to be in the bank after closing. Gift funds from family count toward reserves, which is often how this gets solved.
Why it exists
The lender is covering the risk that you make house payments for a few months with no paycheck coming in. Showing the cash to bridge the gap is the trade for being allowed to close early.
A timeline that works
- As soon as the contract is signed: call me and get fully underwritten, not just pre-qualified. This program is underwritten by a person, which takes a little longer and is worth starting early.
- House-hunting trip: shop with an approval in hand. Listing agents take an underwritten physician approval seriously.
- Pick the closing date on purpose: line it up with your lease ending and your start date so the reserve gap is as short as possible.
See how the full process works, or check whether you qualify first.