In Texas the debt is the problem, not the price
Program and regulatory figures verified October 5, 2026. Details change; confirm your scenario with us.
Texas gives physicians the one thing California cannot: an affordable house. What it does not fix is the balance you finished training with.
Three rulebooks, one balance
| Route | How the payment is counted | Source |
|---|---|---|
| Physician programme | Your documented income-driven payment | Sequoia guide v1.1 |
| Conventional | 1% of the outstanding balance | Fannie Mae B3-6-05 |
| FHA | 0.5% of the balance where the payment is zero | HUD 4000.1 |
| Balance | Conventional (1%) | FHA (0.5%) |
|---|---|---|
| $200,000 | $2,000/mo | $1,000/mo |
| $300,000 | $3,000/mo | $1,500/mo |
| $400,000 | $4,000/mo | $2,000/mo |
Those are phantom obligations — amounts you are not paying that nonetheless consume your debt-to-income capacity.
★ Why this matters differently in Texas
Put the numbers side by side and the Texas situation is unusually stark.
A Houston physician is looking at a typical home of $305,001. A $300,000 training balance produces a $3,000 monthly phantom debt on conventional financing. The debt is about the same size as the house, and it is the debt that stops the file.
That is not the California problem. There, San Jose's typical home is $1,527,731 and the binding constraint is the loan limit. In Texas every major metro sits far below the $832,750 conforming limit:
| Metro | Typical value | Room under the limit |
|---|---|---|
| Austin | $417,977 | $414,773 |
| Dallas | $360,437 | $472,313 |
| Houston | $305,001 | $527,749 |
| San Antonio | $276,747 | $556,003 |
So in Texas, if a physician file fails, it almost never fails on loan size. It fails on the ratio. The full market picture.
What "documented" means
Evidence, not assertion — a current statement or servicer documentation showing the actual scheduled payment under your plan.
Two things to raise early: a documented $0 payment is treated differently across rulebooks and is the most common thing to get wrong by assumption; and if your plan recertifies between application and closing, the number can move. Say so at the start.
We are lenders rather than student-loan advisers. Which repayment plan suits your career is a question for you and your servicer; how each one underwrites is ours.
And the state programmes
Texas runs a Physician Education Loan Repayment Program and a Mental Health Professional Loan Repayment Program through THECB. Both pay real money — $22.1 million and $15.2 million in FY2024-25.
Two cautions. An award you have not been granted is not income a lender can use. And the July 2026 State Auditor report found the Board wrongly denied some applicants eligible for prorated awards. What the audit found.
We publish no maximum award figure, because we could not verify one in a current primary source — and the widely repeated "$180,000 under SB 998" does not reflect enacted law. Why that figure is not here.
Frequently asked questions
How do physician loans count student debt in Texas?
A physician programme can qualify a borrower on a documented income-driven payment. A conventional loan counts 1% of the outstanding balance under Fannie Mae B3-6-05, and FHA counts 0.5% of the balance on a zero-payment loan under HUD 4000.1.Why is student debt the main obstacle for Texas physicians?
Because Texas house prices sit far below the conforming limit while training debt does not shrink. Houston's typical home value is $305,001, and a $300,000 training balance produces a $3,000 monthly phantom obligation on conventional financing, so the ratio rather than the loan size is what ends files.Can a Texas loan repayment award help my mortgage application?
Not before it is granted. An award you have not received is not documented income a lender can use, and until an award pays a balance down the balance underwrites as it stands.What is the maximum Texas physician loan repayment award?
This site does not publish one, because no current primary source could be verified. The Legislative Budget Board brief on the programme is from April 2013 and the Coordinating Board's own audit document is from 2018, and a widely repeated $180,000 figure traces to an introduced bill that did not become law.Mike Certo · NMLS #260555 · Cornerstone First Mortgage NMLS #173855 · Equal Housing Lender. Educational content, not a loan commitment and not legal, tax, or licensure advice. Physician-loan program terms, eligible degrees, and overlays are set by the lender and change; Texas loan-repayment program terms and award cycles change too. Confirm your scenario with us and your program administrator. All loans are subject to borrower and property qualification, including credit and income review.