Securing a mortgage can be complex for GPS, doctors and other medical professionals, and especially if you are a locum doctor or self-employed. In this Guide, we take a look at how to take the first step onto the property ladder.
Doctors often face unique challenges when applying for a mortgage. Because of the complicated earnings and varying future opportunities, your lender will need to analyse each situation on a case-by-case basis. And, if a traditional lender is struggling to understand the idiosyncrasies of your earnings, they might not be able to give you access to a property.
At the same time, by understanding this system and leveraging the help of lenders that can assist you, you can move up the property ladder and secure the property you wish to call home.
Doctors Earnings Are Complicated
Doctors' earnings are known to be complicated, which only makes it more difficult for lenders to understand the financial position you are in now and will be in the future. A few facts to keep in mind include:
Salaries GPs and GP partners make up only a quarter of the whole workforce.
Doctors and GPs that only work as locums might be considered as sole traders, and they will need to prove their own IR35 tax status.
NHS personnel earning a salary as well as merit awards, private practice income, payments for lecturing, and hospital board salaries will have complicated earnings and cost forecasts.
A Flexible Mortgage Suitable for Mobility
If you are trying to secure the most advantageous mortgage during your training contract, you might need to allow for extra flexibility. Indeed, you might be required to move from a hospital to another, or even transfer between locations and cities!
Leveraging Your Future Earnings
While this already makes buying a home in a certain location challenging, it is crucial that your contract allows you to let out your property for periods of time when you need to work somewhere else. For this, your lender will need to agree to a consent-to-let or buy-to-let (if you relocate permanently and decide to buy a second property).
Doctors' traineeships means it may delay the date when you can get your life fully established and buy a property. Trainee or junior doctors will start on basic salaries - often around £23K a year - which can make it challenging to save up and invest in a property. However, independently from your first salary, the prospects in such a profession can be bright and advantageous.
At the same time, high-street banks and lenders only deal with buyers that can count on a fixed salary, often buying once the finances allow them to.
So, many of these lenders will struggle to understand medical training contracts and the future earnings these can lead to. In turn, this might might translate into less attractive rates or mortgages than the earning potential of a doctor should be able to warrant.
Is It Difficult to Get a Mortgage as a Doctor?
If you can't count on a fixed salary, it is possible that you are operating as a Limited Liability Partnerships (LLPs). A doctor practising under this type of setting will see their income fluctuate and change over time. Just like in the case of self-employed individuals, these variations might represent a challenge for lenders.
Alternatively, if you are employed as a locum or work in several settings (such as a combination of private practices and NHS), your income will vary depending on several factors. Indeed, the hours worked in a role might pay more or less than when practising in another.
The finances of junior doctors and trainees are even more complex. Indeed, they might be working for a lower income than more experienced doctors, but their earning potential is extremely high.
All these factors and variables will make it more complicated for a traditional lender to fully understand your position, which might translate in a denied mortgage. So, when looking for a lender that can assist you, you should always opt for one that specializes in mortgages for doctors or has experience in this field.
Mortgages for Newly Qualified Doctors
Newly qualified doctors or junior doctors are likely to have just started working or about to secure their first post. When finding a lender that will grant a mortgage to doctors in this position, it is essential to find those that won't require the usual employment records for the past three months.
Mortgages for Trainee and Junior Doctors
At the start of a brilliant medical career, you might not be able to count on a high salary for the first years. Because of the bright prospects that doctors have, your incomes are likely to increase as you progress steadily. But, it is essential for the lender to understand so! At trufe., our job is to find you a lender that understands the ins and outs of this profession and can provide mortgages to doctors that are still in training.
Mortgages for Locum and Self-Employed Doctors
After years of medical training and working for the NHS, many doctors decide to move into a self-employed position. When doing so, your finances will change, and your incomes are likely to increase. However, they will also fluctuate - especially during the first years of being self-employed.
Doctors working in private medical clinics will usually need 2 or 3 years' worth of tax returns if you wish to obtain the mortgage you want. This system is what self-employed practitioners use to prove their incomes, but it can also represent a major obstacle if you have just started your practice.
Nonetheless, the right lenders will only require you to provide just one-year worth of tax accounts - so you can get the mortgage you want within your first year of practising.
Employed NHS Doctor Moving to a Contractor/Self-Employed Role
There are particular scenarios in which doctors that have been previously employed have then joined a private practice or become self-employed. In this case, trufe. can help you prove your income and make exceptions to the standard lending policies. So, you can obtain the funds you require to secure your property.
Mortgages for Surgeons
Mortgages for surgeons can be complicated. However, through the right mortgage broker, you can be sure to obtain the best rates and financial products for your needs.
What Terms Can trufe. Secure for Doctors & Health Professionals?
What Mortgage Can a Doctor Get?
Not all doctors and healthcare professional will be able to obtain the same amount of mortgage as several different factors will determine how much you can borrow. Generally, because of the job's earning potential and prospects, you can borrow around five or six times more than your current income - which is already a much higher rate than most professionals. However, finding the right lender is necessary.
Do Doctors in the UK Get Better Mortgage Rates?
Some lenders, especially those that have previously worked with doctors, will offer more favourable rates for healthcare professionals. These special terms can be offered because such mortgage lenders understand the earning and career potential of doctors, even junior or trainee ones. Opting for a lender that uses a greater income multiplier to determine how much to lend could be an advantageous choice for doctors. trufe. can help you in the search for such lenders.
How Can trufe. Help With Mortgages for Doctors?
If you are a doctor applying for a mortgage, it is essential to get financial advice from those lenders and brokers who already have experience in the field. Indeed, these are more likely to understand the nature of your job and offer you more advantageous rates - and it is important to do so before anything else.
Indeed, repeated failed attempts to obtain a mortgage can leave a mark on your credit score and reduce the possibility of obtaining an advantageous mortgage rate in the future. So, to prevent your applications from being denied several times, it is recommendable to get in touch with a mortgage broker who is highly experienced in securing mortgages for doctors.
Are Offset Mortgages a Good Option for Doctors?
Offset mortgages are a type of mortgage that allows you to link the balance to your savings. These, working as the "offset", allows you to reduce your monthly repayments and the length of the mortgage.
For example, if you need to borrow £100,000 with an interest rate of 3%, but you also have £10,000 in savings, you will only pay the interest on £90,000 (£100,000 - £10,000).
If you have been able to save, and you can count on a certain sum, you might decide to opt for this alternative to reduce the interest rate and repay smaller monthly payments.
Arranging a Mortgage Around Antisocial Work Schedules
Finding a broker who can help you arrange a mortgage around your antisocial working hours and schedule is essential. Indeed, the process of obtaining a mortgage is known to be lengthy and effort-consuming - and it often happens while you are juggling a full-time job! Certain brokers such as trufe. can help you set your appointments around your work schedule, reduce delays, and streamline the process.
Mortgage Fast-Track Services to Secure the Property You Like
Often, finding the property of your dreams and applying for a mortgage happen at the same time. And, the time pressure you might feel in this case is undeniable!
Here at trufe., we understand how much effort went into finding the right property, and we are committed to working fast and without delays to get you the mortgage you need to secure the property! Start your journey today
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trufe. is a trading name of Green FS Ltd (FRN 833558) which is an appointed representative of HL Partnership Limited, who are authorised and regulated by The Financial Conduct Authority.
The Financial Conduct Authority does not regulate commercial lending, secured or unsecured loans and some forms of Buy to Lets. Equity release includes Lifetime Mortgages and Home Reversion Schemes. We can advise and arrange Lifetime Mortgages and will refer to an approved specialist for Home Reversion schemes.
Your property may be repossessed if you do not keep up repayments on a mortgage or any debt secured on it.
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The information contained within this website is subject to the UK regulatory regime and is therefore targeted at consumers based in the UK.
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