Buy the House Before the First Paycheck.
A signed employment contract can qualify you for a physician mortgage on the salary you are about to earn, not the resident salary you have now. Most physicians who use it close sixty to ninety days before their start date, so the move and the new job do not land in the same week.
How Contract-Based Qualifying Works
Standard underwriting wants to see income you have already received. That is a problem for a PGY-4 with an attending offer in hand: the paystubs say resident, the contract says attending, and the house needs to be bought in between.
Physician programs solve it by accepting a fully executed employment contract as the income document. The underwriter qualifies you on the contract salary, subject to the contract meeting a handful of conditions and the start date falling within the program's window. You close, you move, you start work. The first paycheck arrives after the first mortgage payment is already scheduled.
What the Contract Needs to Say
Underwriters want to see
- Signed by you and the employer, not a verbal offer or an email
- A base salary stated as a number, not a range
- A start date, ideally within the program's window of your closing
- Position, location and employer clearly identified
- Any contingencies (licensing, credentialing, boards) that you can satisfy before closing
What stalls a file
- An offer letter with no employer signature
- Compensation described only as productivity or RVU-based with no guaranteed base
- A start date too far out for the program's window
- Open contingencies the employer can still use to walk
- A contract that names a different entity than the one paying you
Bonuses, RVU upside and partnership tracks usually do not count toward qualifying income on a contract. The base does. If most of your comp is variable, say so on the first call; there are ways to structure around it, and the worst time to discover it is in underwriting.
The Timing, Which Is Most of the Strategy
Contract signed (often 6 to 12 months out)
Send it to Sean the day it is executed. This is when the pre-approval gets built, the program gets chosen, and the licensing or credentialing contingencies get mapped against your closing date.
Pre-approval on contract income
Typically within 24 to 48 hours. You shop with a real number, backed by a top-five U.S. bank, in a market where sellers ask.
Under contract on the house (90 to 120 days out)
Rate lock and closing are scheduled to land before your start date, inside the program's window. Reserves and the down payment are verified now, not on the closing morning.
Close, move, start
Most physicians close 60 to 90 days before day one. Keys before the move, the move before the job. The first paycheck lands after the first payment is already on the calendar.
Who This Is For
- Residents and fellows with an accepted attending position
- Attendings changing jobs with a signed contract at the new employer
- MD and DO physicians, in training or within roughly ten years of finishing it
- Relocating physicians who need the house in the new city before the job starts
Program limits, eligible degrees and the exact start-date window vary. The physician programs Sean uses allow low down payments with no monthly mortgage insurance up to program limits, and treat student loans on the payment you actually make rather than the balance. Details are in the complete guide.
The Down Payment Question, Answered Honestly
Contract qualifying solves income. It does not manufacture a down payment. What helps: gift funds from family are generally allowed for the down payment, closing costs and reserves on these programs, and the low-down-payment tiers mean the number is smaller than most residents assume. What also helps is planning for what comes after closing: if a signing bonus or a home sale is on the way, a mortgage recast lets you apply it to principal later and lower the payment without refinancing.
Five Mistakes That Cost Physicians the House
- Waiting for the first paystub. You do not need it, and waiting puts the move and the job in the same week.
- Sending the offer letter instead of the contract. Unsigned means unqualified.
- Letting a licensing contingency ride. Clear it before closing, or plan the closing after it clears.
- Opening new credit during the process. The moving-truck card and the furniture financing can wait thirty days.
- Picking the program before asking about recasting. If a lump sum is coming, choose the loan that lets you use it.
Frequently Asked Questions
Can I really qualify before I have started the job?
How far out can my start date be?
Does an offer letter count?
What if my pay is mostly RVU or bonus?
Do my student loans kill this?
Can family help with the down payment?
Do you work in my state?
About the Author
Sean Shallis is a Mortgage Loan Originator (NMLS #2362814) at a top-five U.S. bank with 30+ years of experience and over $1B in closed transactions. He's married to a physician, a U.S. Army veteran, and the creator of Rate Guardian AI. Opinions here are his own as an individual market observer.
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