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BEWARE of using AAMC MEDLOANS

Discussion in 'Financial Aid' started by tennisnr, Aug 4, 2006.

  1. tennisnr

    tennisnr Senior Member
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    Sallie Mae and AAMC MED LOANS have absolutely no idea what they are doing. The AAMC pamphlet most of us got and the website (http://www.aamc.org/students/medloans/loanstates/0607/loans0607/classictc2006.pdf) say for the classic option (healthier returns) that there is a $11203 (4.5%) Stafford Cash Back savings on the ORIGINAL loan amount after 33 on time payments. This is based on a $154000 Stafford Indebtedness but 4.5% of $154000 is $6930 NOT $11203. The math for the Healthier returns benefit also does not work out.

    I talked to the origination department of Medloans and they were like "Oh we aren't sure how they get that number but it's probably right because we see it on that site." This was not at all convincing to me and so I talked to the repayment and benefits office of medloans. There they said they have never seen that information but all they do is take 4.5% of the original loan and so it would end up being $6930.

    The people at these departments have no idea what they were doing and I had to send them to the above link and show them what I was seeing and how the math does not work out. Before that all they were telling me is, "Oh that's just an example sir...I wouldn't worry about it"

    They are currently "researching" this and will call me back.

    BEWARE of AAMC MEDLOANS and SALLIE MAE. They have no idea what they are doing and are possibly misleading all of us on how much benefits we will receive.
     
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  3. tennisnr

    tennisnr Senior Member
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    I just got a call back after they "researched" the discrepancy.


    AAMC on the above site and the pamphlets we got have this:

    MEDLOANS Stafford Loan
    Classic Option*
    Federal Default Fee Savings $1,540
    Healthier ReturnsSM Benefit $8,627 (3.5%)
    Stafford Cash Back Savings $11,203 (4.5%)
    Total Savings $21,370

    Based on $154,000 Stafford Indebtedness

    This is NOT true like I thought and is a misprint. They are trying to contact AAMC at the moment to change this.

    The TRUE medloans stafford loan
    classic option

    Federal Default Fee Savings $1,540
    Healthier ReturnsSM Benefit $5,390 (3.5%)
    Stafford Cash Back Savings $6,930 (4.5%)
    Total Savings $13,860

    There's also a 2% origination fee with the classic (healthier returns) option so the Total Savings = $10780

    This is a huge difference compared to what AAMC and Sallie Mae were orginally saying.
     
  4. Reimat

    Reimat Friend of talking skulls
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    Wow, thanks for the info. I hate how complicated loan contracts are - or how shady companies can be in presenting information. I wonder if they actually will update those numbers on their website...
     
  5. jbrice1639

    jbrice1639 Cub Fan, Bud Man
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    keep in mind you can't just multiply the interest rate by the principal of the loan though...as you add interest on a loan, the interest keeps compounding on itself...so it's more over time than just the rate times the principal.
     
  6. 1SwtWrld

    1SwtWrld Senior Member
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    I noticed they were pretty disorganized too. I was originally going to go through them for a Grad Plus Loan but after being told several different things by different people I opted not to.
     
  7. tennisnr

    tennisnr Senior Member
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    The percentages I had listed weren't interest rates....

    They are the perecentage of the original loan aamc medloans is giving back to the student, which is simple math they calculated incorrectly. They incorrectly showed you were getting back a certain large amount when in reality you would get back a much much smaller amount.
     
  8. temmie

    temmie Senior Member
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    okay guys. i am glad you brought this up. I am the most illiterate person when it comes to loans. This is my first time taking out loans and i dont know what i should know.
    I will be borrowing some money through AAMC medloan so if anyone can explain the basics, in lay-man words, that will be great. Thanks guys
     
  9. njbmd

    njbmd Guest
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    Hi there,
    Moving to Financial Aid where this thread is more appropriate.
    njbmd :)
     
  10. sentrosi

    sentrosi INTARWEB USER
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    I noticed the discrepency too. I don't even know what kind of bizarre process they used to come up with the numbers they list, but it's quite misleading.
     

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