Canadians: Which line of credit are you going for?

[mr1985]

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Hello Canadians,

I'm just wondering if anyone has looked into lines of credit yet. I hear the one offered by Scotia Bank is the most common for medical students. I wonder if the same is true for vet students?

Also, does anyone have any tips on what to look for in a line of credit?

 

[168135]

I'm pretty illiterate when it comes to banking. I have a line of credit with my bank, RBC... my parents are with that bank and they have something hooked up where they can put money into my line of credit... that's basically the reason why I haven't looked into any others.

 

[Coquette22]

I know nothing about lines of credit, except that my sister got herself into all kinds of trouble with one (she's also bad with money though). I'll probably go with TD, because all my other accounts are with them, and I like dealing with them. I've dealt with ScotiaBank in the past, and they're a horrible headache.

 

[frozen_canadian]

Try not to get a LOC if you can afford it. Most vet schools in Canada are reasonable enough that a gov student loan + summer jobs should cover most of the cost of attendance. With a LOC, you're charged interest as soon as you use the money...which adds up. A lot. Especially when you're then charged interest on the interest. With a gov loan, interest is deferred until after grad.

 

[mr1985]

Try not to get a LOC if you can afford it. Most vet schools in Canada are reasonable enough that a gov student loan + summer jobs should cover most of the cost of attendance. With a LOC, you're charged interest as soon as you use the money...which adds up. A lot. Especially when you're then charged interest on the interest. With a gov loan, interest is deferred until after grad.

Which vet school do you go to? AVC's tuition is $11,500 next year, so I'd need a pretty hefty loan ...

When you say government student loan, do you mean through the federal or provincial government? Do you know how much the government usually gives vet students?

 

[Coquette22]

When I was applying for my loan for this year, I noticed that NS has a $140/week supplement for medical and dental and law students. I wonder if you could call them and see if they'd extend that to vet students as well.

 

[mhlaur]

Try not to get a LOC if you can afford it. Most vet schools in Canada are reasonable enough that a gov student loan + summer jobs should cover most of the cost of attendance. With a LOC, you're charged interest as soon as you use the money...which adds up. A lot. Especially when you're then charged interest on the interest. With a gov loan, interest is deferred until after grad.

I completely disagree. The government loan will have a much higher interest rate than a credit line. Professional student credit is prime + 1%, but government loans are prime + 5%. If you do get a LOC, you should pay the interest while you're in school. Not doing that is what gets you in trouble. Use the LOC to pay the interest, simple as that. You only pay interest on the amount you've used so far. Your first year, it's only $58/mth if you've used $20K.

You may have to do both LOC and student loans. RBC gives $20K per year for 4y. I think govt loans are max $350 per week.

 

[Newfie Girl]

I'm going with CIBC they offer professional lines of credit up to $125000 for 4 years. I'm very good with money so I'm not worried about getting more than I need, I just don't want to have to worry about money for those 4 years haha. And then you can switch it over to a personal line of credit when you're done. My theory is take the credit thats avaliable to you when you don't need it, because when you need the credit, it won't be avaliable. Just BE RESPONSIBLE!!! haha

 

[frozen_canadian]

I completely disagree. The government loan will have a much higher interest rate than a credit line. Professional student credit is prime + 1%, but government loans are prime + 5%.

This is true. HOWEVER, like I said above, the interest does not begin to accrue until after graduation with a government loan. With a LOC, the interest begins piling up as soon as you strart using the money. The truly smart thing to do, and what a lot of my classmates did, is to take out the government loan, and also a line of credit. Only us the gov loan during school, if possible, and then pay the whole thing off with your line of credit right after grad to take advantage of the lower interest rate.

@Mr1985 - I went to WCVM. Tuition was $7000/yr, I think at OVC it is less. Didn't know AVC was that much more. I got about $12,000/yr in student loan money + about $4000/yr from my summer job. This was more than enough to live a frugal student lifestyle and cover my COA. Now I'm working, I'm so glad loan payments are manageable...

 

[mhlaur]

The truly smart thing to do, and what a lot of my classmates did, is to take out the government loan, and also a line of credit. Only us the gov loan during school, if possible, and then pay the whole thing off with your line of credit right after grad to take advantage of the lower interest rate.

Agreed, this would be a very good idea.

 

[pierlucke]

Agreed, this would be a very good idea.

This is what I'm doing. You also need to consider the fact that interest from a government student loan will be remove from your paid taxes as a futur vet (not sure how to say that , I'm french😉 ) . Since a student loan from a Bank is considered as a personnal loan , this won't work with this one ...

 

[mhlaur]

This is what I'm doing. You also need to consider the fact that interest from a government student loan will be remove from your paid taxes as a futur vet (not sure how to say that , I'm french😉 ) . Since a student loan from a Bank is considered as a personnal loan , this won't work with this one ...

Ahh, yes, you mean the tax deduction for the interest on student loans. Forgot about that one. Never had student loans before. Not sure if I'll qualify for any. I guess I'll apply today and find out.

 

[pierlucke]

Ahh, yes, you mean the tax deduction for the interest on student loans. Forgot about that one. Never had student loans before. Not sure if I'll qualify for any. I guess I'll apply today and find out.

Yes , this is what I was trying to say😉. Also , you may want to have a look with an EI office. I don't know what you have been doing before, but you may be eligible for some ''Worker going back to school plans'' I'm not sure about what you need to be eligible to those plans and what can of help they give you... no harm in trying.

Moreover , this year you may not have a big student loan from government but after a year at school , you theorically don't have a very large income , you may have a larger amount. According to me , you should try it ...I'm not sure about how they work in your state, but this is what is going to happen for my specific situation

 

[mr1985]

The Scotia Bank LOC looks good. I emailed the rep in charge of the LOCs for AVC. Here are some details she sent:

* $85,000 over 4 years ($21,250 each year)
* interest rate is prime + 1% which is a floating rate and will change with prime.
* the option to defer all interest payments until you have completed your program as long as you are within your line of credit limits
* And most importantly you are not required to go under repayment until you have completed school / residency / internship. We also have flexible options including a 12 month repayment grace period after your studies have ended.

The bolded one is interesting. I wonder if there's any downside to deferring interest payments.

EDIT: I guess if you defer the interest payments, they just build up over the four years.