What’s up, Doc – Medical Professional Mortgages, A New Niche in RMBS?

Medical professional mortgages (MPM) are loans originated through specialized prime mortgage programs for borrowers in the medical field, often referred to as physician or doctor loans. These programs are designed to accommodate financial characteristics common among physicians early in their careers, including elevated student debt, limited accumulated savings, and reliance on executed employment contracts rather than established income histories.

Historically, most MPM lending has remained on bank balance sheets rather than being securitized as a standalone collateral type in securitization markets. However, growing origination volumes and increased participation from prime private label residential mortgage-backed securities (RMBS) issuers suggest physician mortgage programs may begin to emerge as a distinct niche within the broader RMBS market. This report reviews the characteristics of MPM loans and considers their potential role as a niche collateral segment within the prime…