Anyone start med school with a couple grand in credit card debt?

[Carbon inc]

I accumulated some consumer debt on a couple credit cards during my undergrad years (not to mention the thousands of dollars of extra debt I added to apply to med school). I've been working and will continue to work until the summer to pay it all off, after which it's time to start med school. But it looks like I may not be able to clear it all. I might have to start school with $2-3000 left in credit card debt and about $4500 in a federal subsidized loan, which I began making payments on this past summer. I'm gonna do my best to at least clear the credit cards.

I was hoping to get some feedback from people who entered med school with consumer debt. Was it an issue for you? How did you handle it once school started? Will this be an issue when it comes time to borrow money?

I also have an excellent credit score, have never been late on a payment and my debt to credit ratio is low.

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[emsdan]

I started with several thousand on my credit card. If your interest rate on the cards is higher than on the loans, use loan money to pay down the card. Make a budget for yourself with car payments, rent, cell phone, etc. and figure out how much extra you have, and then pay off the cards with it if you can.

 

[TooMuchResearch]

I started with several thousand on my credit card. If your interest rate on the cards is higher than on the loans, use loan money to pay down the card. Make a budget for yourself with car payments, rent, cell phone, etc. and figure out how much extra you have, and then pay off the cards with it if you can.

Yup. Also, having some CC debt will not affect your federal direct/Stafford loan eligibility.

 

[Jorski]

I too started with some credit card debt (a bit more then 3k...) due to underestimating my need in undergrad and not asking for help.

Make sure you budget so you can pay that mofo down. Also, if you can transfer to a 0% interest card (intro) and then a lower interest rate (regular), it def helps. I have excellent credit but was unfortunate enough to be on a card that had its interest rate jacked (13% to 28%, thanks Bank of America), and I wasn't getting anywhere. I transfered to a Discover card and have a much better rate (0% intro, 11.25% regular). It definitely helps.

 

[cpants]

Just pay the card off with your student loans first semester. Borrow extra to do so if need be. Your undergrad loans will go into deferment and you'll pay nothing until residency or later. Student loan interest will be much less than your cc interest.

 

[Carbon inc]

Thanks for the responses! I was just worried about potential issues that may arise if I still have credit debt. I definitely plan on using some loan money to pay off whatever balance I have left on my cards.

 

[caseofthemndays]

Eeep!!! Yeah, I have some credit card debt, mostly from paying for AMCAS and the MCAT and stuff..... I'm paying the minimum balance off, but I'm considering taking out more student loans to pay it off.....

 

[Farmacist2011]

Just pay the card off with your student loans first semester. Borrow extra to do so if need be. Your undergrad loans will go into deferment and you'll pay nothing until residency or later. Student loan interest will be much less than your cc interest.

I was going to start a post like this. MY question is I had a terrible medical issue a few years ago, racked up over 50K in medical bills. Luckily I had good insurance, but in the end I still have 5K im responsable for paying.

The 5K is on my credit card bill and I have a 8K car loan. I'm going to pharmacy school, 3 year accelerated. I have enough money to cover my car payments for a year and plan on working part time and as a pharmacy intern which is paid to keep up with that.

Would it be best to just borrow more my first year to get rid of that 5k on my credit card? The interest rate is 7.9% (I have decent to good credit). My loans are going to be government, not sure what their rate is now, 6.8 or something? So should I use loan money to pay it off my CC or just pay minimum payments on my CC with my part time job until I start working more as an intern and graduate making a good salary?

😕

 

[cpants]

I was going to start a post like this. MY question is I had a terrible medical issue a few years ago, racked up over 50K in medical bills. Luckily I had good insurance, but in the end I still have 5K im responsable for paying.

The 5K is on my credit card bill and I have a 8K car loan. I'm going to pharmacy school, 3 year accelerated. I have enough money to cover my car payments for a year and plan on working part time and as a pharmacy intern which is paid to keep up with that.

Would it be best to just borrow more my first year to get rid of that 5k on my credit card? The interest rate is 7.9% (I have decent to good credit). My loans are going to be government, not sure what their rate is now, 6.8 or something? So should I use loan money to pay it off my CC or just pay minimum payments on my CC with my part time job until I start working more as an intern and graduate making a good salary?

😕

Do the math and see what makes sense financially. There are distinct advantages to having the debt in student loan form. It can be deferred until you are making money, and if you are out of work it can go back into deferral. Interest is generally lower, though 7.9% isn't horrible. The advantage of CC debt is that it could disappear if you ever need to file bankrupcy, while student loan debt is almost impossible to get forgiven.

 

[Farmacist2011]

Ok I think I'll throw it on my student loans- use my little but of income for my car and living expenses.

 

[ar2388]

yea i started with a little (haha little) more than a few thousand.... still have a lot of it bc sometimes i need to buy stuff during and for school ( thanks step 1).. it hasnt been an issue. part of the loans are for personal expenses so i use that to make sure that i can make payments every month of more than the minimum payment (at least 2-3x as much as the minimum).. i figure once i start residency and actually making money, ill pay it off... defintieyl cant do it now.

 

[cpants]

yea i started with a little (haha little) more than a few thousand.... still have a lot of it bc sometimes i need to buy stuff during and for school ( thanks step 1).. it hasnt been an issue. part of the loans are for personal expenses so i use that to make sure that i can make payments every month of more than the minimum payment (at least 2-3x as much as the minimum).. i figure once i start residency and actually making money, ill pay it off... defintieyl cant do it now.

This probably isn't the best strategy. I say that because you are essentially paying double interest on the money by paying it off over time with additional loan money. If you are using loan moneys to pay off your CC, it makes sense to do it immediately to avoid the double interest.

 

[Daedra22]

If it's hard to pay it all off in one semester, you could always do it 1 semester at a time. I was able to pay off a good half of my non-school debts last semester, and plan to deal with the rest at the end of this one. Budgeted properly, one should be able to enter residency without credit card debt (or with very little).

 

[metallica81788]

I had about $2000 going into school and thought I could pay it off with my loan money after I budgeted everything. Well, I overlooked the computer my school makes us buy, which was the $2000 that would have paid off my credit debt.

Now that I'm about to get my loan check for this semester, I have around $2200 and I'll be able to pay all of that off when I get the money.

It has been done and can be done without penny-pinching too much.

 

[AMEHigh]

Just pay the card off with your student loans first semester. Borrow extra to do so if need be. Your undergrad loans will go into deferment and you'll pay nothing until residency or later. Student loan interest will be much less than your cc interest.

That's not necessarily true. I have 2 cards (paid off) that have a 3.9% rate, which is lower than my loans. I also receive offers all the time for very low interest or 0% interest for 12 to 24 months on balance transfers. Not all credit cards have high interest.

To the original poster - here's a link that can help you calculate how much interest you'll be paying on your card. http://www.whatsthecost.com/snowball.aspx

 

[TooMuchResearch]

yea i started with a little (haha little) more than a few thousand.... still have a lot of it bc sometimes i need to buy stuff during and for school ( thanks step 1).. it hasnt been an issue. part of the loans are for personal expenses so i use that to make sure that i can make payments every month of more than the minimum payment (at least 2-3x as much as the minimum).. i figure once i start residency and actually making money, ill pay it off... defintieyl cant do it now.

Discover More 0% APR balance transfer w/ no fee for 12 months. Make minimum payments with your student loan dollars, and let the card issuer eat the lost interest. There's a good chance you can float it to a new 0% APR balance transfer w/ no fee just before the regular interest kicks in on your new card. You'll have to do some math to see if it's worth the hassle. Also, this isn't really the correct forum to discuss credit float, so I will stop.

 

[cpants]

Floating to new cards is an option, but use it with caution. Those zero percent offers aren't as common as they used to be. Also, opening new cards can hurt your credit score. For most students 2 grand will be a drop in the bucket compared to their overall debt. Just doesn't seem worth the hassle to play games with the cc companies.