Home loans for doctors and medical professionals

What is actually on offer

Borrowing more than 80% of a property’s value normally triggers lenders mortgage insurance — a premium that protects the lender, is paid by you, and on a large loan runs well into five figures.

A small number of lenders waive that requirement for eligible medical professionals. Not as a discount, and not as generosity: medical professionals as a group show low default rates and strong, durable income growth, so the waiver is a commercial judgement about risk.

What is worth understanding is that it is not one policy. It is a dozen different policies that happen to share a name, and the differences between them are larger than most people expect.

There are two tiers, and which one you are in matters more than anything else

Almost every lender offering a medical waiver splits the eligible list in two.

The upper tier — waivers available to around 95%. At most lenders this is the narrowest group: general practitioners, hospital-employed doctors, medical specialists including psychiatrists, and dentists and dental specialists. One notable exception: at least one lender’s top-tier list also includes physiotherapists, pharmacists, optometrists, chiropractors and veterinarians.

The second tier — waivers available to around 90%. A much longer list, though which roles appear on it varies: audiologists, chiropractors, midwives, occupational therapists, optometrists, osteopaths, pharmacists, physiotherapists, podiatrists, psychologists, radiographers, registered nurses, sonographers, speech pathologists and veterinarians all appear on some lenders’ second-tier lists.

At the other extreme, at least one lender accepts registered medical practitioners alone — no dentists, no allied health, no exceptions.

For allied health, the exclusions are the whole story

This is the part almost nothing published about medical home loans will tell you, and it is the reason a general answer is worthless.

Several of the largest lenders that offer medical waivers explicitly exclude nurses, physiotherapists, psychologists, occupational therapists, pharmacists, podiatrists and radiographers — in at least one case with a stated no-exceptions rule. Other lenders include those exact roles at up to 90%.

So two allied health professionals with identical income and deposit can get completely different answers, purely on where the application went. If you are in one of those roles, the question is not whether medical policy applies to you in general. It is which lenders’ lists you appear on, and whether those lenders suit you in every other respect.

The conditions attached to the headline figure

Occupation gets you considered. These decide the outcome.

Debt-to-income. The most common gate on the top of the range. Several lenders offering waivers to 95% require total debt below six times income, and drop to 90% above it.

Repayment type. Principal and interest is the norm. Interest-only is commonly capped at a much lower LVR or excluded entirely, with some lenders allowing it only where it converts to principal and interest.

Loan purpose. Owner-occupied purchases are the most straightforward. Investment lending is available under some medical policies at a lower maximum, excluded under others, and — at one lender — actually available at a higher LVR than the owner-occupied concession. Refinances are accepted by some and not others.

Construction and vacant land are usually excluded. Worth stating separately because of where this practice is based: much of the buying in Melbourne’s northern corridor is house and land, and most medical waiver policies do not cover it.

Loan size and exposure caps. Every lender applies them, and the range is wide — from around $2 million on a single security at the tighter end to $7.5 million in total group exposure at the more generous. If you are buying at the upper end, this narrows the field faster than eligibility does.

Income tests. Some lenders require at least half your assessable income to come from the profession. Others set a minimum combined income from the qualification, or a minimum number of years in the field.

Practical restrictions that catch people: some lenders will not issue pre-approvals under the policy, cap cash-out, exclude family guarantees, or decline company and trust borrowers.

This market has been shrinking

Two things worth knowing.

Most lenders do not offer a medical waiver at all. The list that does not — including many well-known non-major and non-bank lenders — is considerably longer than the list that does.

And at least one significant lender has withdrawn its medical waiver outright. A figure someone quoted you last year, or a page you read online, may describe a policy that no longer exists.

Both of these mean the same thing in practice: this is a policy area where what matters is which lenders a broker can actually reach, and what their policy says this month.

Income assessment usually matters more than the waiver

The waiver gets the attention. How your income is read usually has the bigger effect on what you can borrow.

Medical income is frequently complicated:

• Base salary plus overtime, which for hospital-employed doctors can be a large share of total earnings
• On-call and call-back allowances
• Shift and penalty loadings
• Private practice income alongside a salaried role
• Multiple employers, or a mix of employed and contracted work
• Locum work, variable by nature

Lenders differ enormously in how much of this they count. One might take a conservative view of overtime where another accepts a much higher proportion given a two-year history. For a doctor whose overtime is a substantial share of income, that single policy difference can move borrowing capacity by far more than the LMI waiver is worth.

For how the two interact — and why a decline under one lender’s policy says nothing about the next — see declined by one lender, what that actually means.

If you are in private practice

The occupation concession and the income assessment are separate.

You may qualify for the medical waiver while having income assessed under self-employed rules — financials, add-backs, trading history. Practice structures involving companies, trusts or service entities add further complexity, and the treatment of retained profits and distributions varies by lender.

The one genuinely useful thing to know here: at least one lender accepts a single year of tax returns from self-employed medical professionals rather than the usual two. For someone who has recently moved into private practice, that can be the difference between borrowing now and waiting a year.

The mechanics are covered in self-employed home loans.

A caution worth stating plainly

A waiver reduces a cost. It does not increase what you can afford.

Borrowing at a high loan-to-value ratio means a larger loan, larger repayments, and less equity buffer if values move against you. The waiver makes that borrowing cheaper. It does not make it right in every circumstance.

The better question is not “what is the maximum available under this policy” but “what should I borrow, given where my income is heading, what I want to do in the next five years, and what happens if rates move”. Our LMI estimator shows what a premium would cost at different deposits, which is the number the waiver is actually saving you.

What to do

The useful step is checking your specific registration against current policy across lenders, alongside a proper read of how your particular income mix will be treated — and, if you are building, whether the policy covers construction at all.

None of that is something a website can settle, because it turns on your role, your income structure, your deposit, what you are buying and what each lender’s policy says this month.

If you have been assuming you need a 20% deposit, it is worth a conversation before you keep saving toward a number you may not need.