Australian lenders have specific policies and discounts for medical professionals that they don’t make available to others. Borrowers in a medical profession usually earn higher than the average income and therefore, viewed as low-risk applicants by lenders. However, are medical interns or residents also viewed as low-risk applicants by lenders?
Medical intern vs resident home loan risk assessment
Medical residents can sometimes be treated as an intern. However, the technicality may differ from country to country or state to state. In Australia, a medical resident is ahead of an intern by one or two years. For most doctors, residency is typically a further period of time following an internship. Both medical interns and residents are eligible for medico loans, which means they qualify for a waived LMI (Lenders Mortgage Insurance). However, the benefits the applicants receive may vary. The assessment of income source, credit history and savings is crucial for lenders to avoid any risks of defaults. Home loans for medical Interns can be tricky as the interns who have just started off might not have genuine savings. Therefore, lenders might not consider such applicants for discounts. Meanwhile, medical residents are more likely to be considered for special discounts. Because medical residents have already gained clinical experience and have a stable income, lenders tend to view them as low-risk applicants.
Am I eligible for waived LMI?
LMI fees apply if you want to borrow over 80% of the property value. However, such fees are waived if you are a medical professional thereby saving you thousands of dollars. Some doctors can borrow up to 100% of the property price and pay no LMI. A few lenders even consider lending over 100% in special cases. However, all medical professionals may not be eligible for LMI waiver. Go through our list of medical professionals that qualify for waived LMI. As a medical intern or resident, you can borrow up to 95% of the property value with no LMI.
95% No LMI Home Loans
A lender on our panel is offering waived LMI on a 95% home loan for medical interns and residents.
There is no minimum income requirement.
To qualify for no LMI on a 95% home loan:
- You must buy a residential property. (Only Category 1 and 2 locations accepted)
- You must hold a university degree from Australia or overseas.
- You must be an Australian citizen or permanent resident living and working in Australia.
- You must be employed and not on probation.
- You have PAYG income in the industry for at least the last three years; doesn’t all have to be with the same employer but you must be past your probation period.
- Minimum credit score required.
- You need a minimum of 2 years’ tax returns and full financials if self-employed. ABN must be registered for at least two years and you must provide evidence of reported profit each year.
- The maximum loan amount is $1 million.
Are you a medical intern?
There are a few lenders in our panel that can accept medical interns under their LMI waiver policy.
To qualify, you would require:
- Most recent Australian tax return, or
- AHPRA registration certificate/copy of the registration with the Medical Practitioners Board of Australia, or
- TCopy of Australian University degree or qualification.
Are you a medical resident?
As far as eligibility criteria for ‘Medico’ loans go, a few lenders include hospital-employed doctors as preferred medical professionals. These include interns, residents, registrars, and staff specialists. If you’re a medical resident, you will have to confirm your qualifications and employment through the same documents as a medical intern. However, policies vary from lender to lender and some may require additional documents.
Please call us on 1300 889 743 or fill in our free assessment form to confirm the policies with one of our specialist mortgage brokers.
Will I get a discount on my home loan?
It’s true that lenders introduce several offers and discounts on doctor home loans. This is because medical professionals have comparatively higher income and thus, the lenders perceive such professions as lower risks in borrowing. They can even borrow more than other customers and save thousands of dollars through discounts. But can you get the same benefits as a medical intern or a medical resident? Medical interns and residents can borrow up to 90% of the property price and avoid paying LMI. Moreover, you can borrow over 100% if your parents guarantee your loan. Special discounts involve reduced interest rates, home loan fee waivers, and LMI waivers. There are certain criteria that you have to meet in order to be eligible for discounts, concessions, or benefits.
How can I improve my chances of getting approved?
You need to be a medical practitioner in Australia or New Zealand and be a member of a registered medical association. Moreover, your membership registration type also influences the decision of lenders.
Lenders accept these registration types:
- General registration
- Specialist registration
Lenders don’t accept these registration types:
- Provisional registration
- Limited registration
- Non-practising registration
Note: Some lenders may accept non-practising registration in case of a temporary absence from practice (e.g. when on parental leave). You will also be eligible for stamp duty concessions and First Home Owner Grant (FHOG) if you are a first home buyer. Other than that, some lenders can accept 100% of your overtime income and allowance for essential services if it is consistent.
Reduced interest rates are available
The interest rates that you pay will vary depending on your professional status, total income, and the amount you are borrowing. The discounts and reduced interest rates may also depend on the packages that lenders offer. Since only a handful of lenders consider applicants who are either medical interns or residents, our brokers can negotiate even sharper rates on your behalf.
Start building your property portfolio
Many medical professionals use waived LMI to buy investment properties and quickly build their property portfolios. Since you may qualify for 90% no LMI, you can look for options to buy a number of properties. It’s the perfect time to start investing but you might want to take into account your income protection and insurance. You can speak with one of our specialist mortgage brokers by calling us on 1300 889 743 to help you set up the right investment loan strategy.
Which lenders offer home loans for medical intern and residents?
Two of our major lenders can help with medical intern and resident home loans. With the help of one of our specialist mortgage brokers, we can properly assess your situation and find you the right loan option. However, choosing the right lender comes down to:
- The size of your deposit.
- The number of properties that you are looking to buy.
- The complexity of your home loan, e.g. family trust.
With many of our customers, we’ve found that splitting up your mortgage between carefully selected lenders can maximize your benefits.
What if I’ve obtained my qualification from a different country?
If you have obtained your qualifications in another country, one of our lenders requires you to:
- Be registered to practice with the Australian Medical Council (AMC) or equivalent body.
- Have a copy of current registration with the Medical Practitioners Board of Australia or equivalent body in the State or Territory in which you practice.
Apply for a home loan today
We know lenders that might be able to help medical interns and residents borrow up to 90% with no LMI.
Buy your dream home sooner or start building your property portfolio by calling us on 1300 889 743 or filling in our free assessment form.