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Doctor Mortgages – Some Questions and Answers
Doctor Mortgages – What are they?
Whilst there is no such thing as a ‘Doctor Mortgage’ there are specialist mortgage lenders out there who tailor their mortgage products to be more attractive towards NHS workers and Doctors and will offer discounts. There are added benefits of using a specialist lender because they understand the nature of your employment better. If you are a Locum working or even a junior Doctor, as long as you can find the right specialist lender you will have options available to you.
It is important to find the right lender to fit your financial situation and it is best to find them by seeking mortgage advice from a Mortgage Broker. They will be able to help you understand the process as well as guide you through it to help you towards buying a property.
How do I prove my income as a Doctor?
Proving your income is essential no matter your profession when it comes to applying for a mortgage. As a Doctor, you could be on contracts, Self-Employed, a Locum Doctor or maybe you work in private practice, no matter what, you will need to prove your income. If you are enrolled in a PAYE system it is easy for lenders to assess your income due to your employer dealing with your tax contribution.
If you are a Self-Employed Doctor or working through contracts then you will need to provide evidence of your income and your taxes paid. You need to try and provide at least two years’ worth of accounts alongside your application so the lender can see you have correctly accounted for your taxes.
As a Doctor under the PAYE payroll system, it is easy for a lender to look into your employment and earnings. If you are under contracts then it is best to have been employed under the same employer for a good amount of time to prove that your income isn’t likely to change.
How much can I borrow as a Doctor?
As a Doctor, you can access mortgage products that will have incentives and discounted rates and If you approach the correct lender you could even end up borrowing more for less!
The longer you have been a Doctor – the better and if you are in a senior role then you will be favoured by lenders.
You will be able to borrow up to five times your annual salary depending upon your own financial situation. You can use a mortgage calculator to give a rough estimate of your potential borrowing amount. It would be wise to speak to a Mortgage Broker to discuss your options and how much you might be able to borrow – if you fail to keep up with repayments on your mortgage then your home may be repossessed.
Do I get a discount if I work for the NHS?
There are lenders out there offering discounts and incentives for NHS staff. You have to ensure you fit into the criteria of the lender to be accepted for discounts. To succeed at NHS discounts you need to be a member of the NHS or NHS Trust Organisation, for instance, a member of the:
- NHS Direct
- NHS GP Surgeries
- Ambulance Trust
- National Blood Transfusion Service.
You will likely be offered flexible mortgages, lower deposit options, or lower interest rates if you can provide evidence that you are deemed part of the mentioned medical professionals.
As well as specialist lenders offering discounts there are also a number of schemes out there to help you take that next step or step onto the property ladder. You can access both First Time Buyers and Buy to Let mortgages if you wish to do so too. Some of the schemes include:
Help to Buy – If you can give a 5% deposit, the Government will match it with a 20% deposit. This scheme is available for First Time Buyers.
Shared Ownership -You can ask the lender for shared ownership and if it is available. You can choose to purchase between 25-75% of the house and then the rest you will pay rent on until you can later buy it.
Right to Buy Mortgages – As a tenant who has rented the same council house or Housing Association house for the past three years, you will have accrued a discount to potentially own your home at a discounted rate.
New Buy Schemes – New builds can be applied for with just a 5% deposit option depending on the lender’s criteria and if the builders are taking part.
How can a Mortgage Broker help?
A Mortgage Broker can guide you through the mortgage application process and give you access to the right mortgage product for you. Doctors have enough stress in their profession, so why add to it by not seeking professional guidance? We understand the nature of your employment and can find lenders who do too.
As we at MAC, we are authorised and regulated by the financial conduct authority, we have access to the larger independent mortgage market which means we can access mortgage rates that high street lenders cannot.
Mortgage Brokers know the mortgage application process and can ensure everything is correct and accurate before submitting it to a lender. Brokers know what documentation is required and will help you gather everything needed to boost your chances of hearing a yes.