Deciding on which lender to choose

[Jzoch]

I was wondering if anyone knows the average length of time Med school loans are in repayment. I would think that I will be able to afford paying more than the minimum payments when I start repayment. How long I am in repayment will affect the which loan incentives are better. Any suggestions will help. Thanks

I am currently trying to decide which lender to borrow my stafford loans from.

AAMC Medloans: 2% origination fee
3.5% credit or cash of original loan amount at graduation
4.5% credit or cash of original loan amount after 33 months

or Citibank: 0% origination fee
0.25% rate reduction with automatic debit
1.0% rate reduction after 36 months
1.0% rate reduction after 48 months

Wayne State University SoM Class of 2010!

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[UserNameNeeded]

3.5% credit or cash of original loan amount at graduation

Whoa. If they didn't have that damn 2% origination fee, this would be a no-brainer for me. Does AAMC Medloans not do the auto-draft rate deduction? I thought every lender did that.

 

[Jzoch]

Well I just got off the phone with AAMC....

The woman on the phone said that the 0.25% rate reduction is included on the majority of their loans, including the Medloans. She does not know why it is not on the terms and conditions web page. So that is more good news.

I am still hoping to hear how long it takes the average doctor to payback their loans (say around $200,000). This will impact which lender has the better benefits.

 

[UserNameNeeded]

I am still hoping to hear how long it takes the average doctor to payback their loans (say around $200,000). This will impact which lender has the better benefits.

That's the big question. I've looked for that answer, too, and haven't found it. Most practicing doctors today never had to take out so much in loans to get their education. No one seems to really know how taking out and repaying so much in student loans is really like!

 

[oldjeeps]

I was wondering if anyone knows the average length of time Med school loans are in repayment. I would think that I will be able to afford paying more than the minimum payments when I start repayment. How long I am in repayment will affect the which loan incentives are better. Any suggestions will help. Thanks

I am currently trying to decide which lender to borrow my stafford loans from.

AAMC Medloans: 2% origination fee
3.5% credit or cash of original loan amount at graduation
4.5% credit or cash of original loan amount after 33 months

or Citibank: 0% origination fee
0.25% rate reduction with automatic debit
1.0% rate reduction after 36 months
1.0% rate reduction after 48 months

Wayne State University SoM Class of 2010!

I thought that MedLoans usually waived their origination fee, but things change every year.

and all those incentives will change when you consolidate your loans anyway.
I would suggest contacting the WSU-SOM fin aid office and talk with Deirdre Moore.

 

[Jzoch]

I have called the financial aid office, but I was told that I would have to speak to the individual lenders to see which loan would work best for me.

I have made a decision though today after speaking to a Dr. who just finished her fellowship last year. She said that she consolidated with a 30 year loan. Her and her husband (also just finishing his fellowship) are paying more than the minimum payments, so it will be paid off sooner than 30 years. She said that after house payments, retirement savings, a new baby on the way, and other expenses there is not enough left to pay on a 10 year loan. She says that the new doctors that she knows who are trying to pay it back so quickly are living in sparse apartments and surviving on tuna and water!

What I left with is: the debt is unavoidable, it is inevitable, just learn to deal with it.

Oh yeah, i decided on citibank (currently - 2.77%/3.37 variable) vs. the AAMC Medloans. (4.7%/6.8% fixed). The credit/cash back incentive didn't add up to the no origination fee/lower interest rates.

 

[heech]

Wait... can you say that again on the rates? The terms you're describing don't seem familiar to me.

AAMC Medloans, for example. You're talking about the MEDLOAN ALP (Alternative Loan), right? Here are the terms according to AAMC:

http://www.aamc.org/students/medloans/loanstates/0607/loans0607/alpdollar.htm

There are no origination fees, but there's a 1.5% supplemental fee when you begin repayment. The rates are also variable, *not* fixed. Prior to repayment, the rate is actually prime + 0.0%... which translates into 8% right now. During repayment, this could be as good as prime + 1.25% (including bonus programs).

 

[CruiseLover]

I filled out my Master promisary note and didn't have a "choice" for a lender. Do I get to do that later? Or does that mean I have no choice?

 

[Jzoch]

No, i am talking about the stafford loans

http://www.aamc.org/students/medloans/loanstates/0607/loans0607/classic.htm

http://studentloan.citibank.com/slcsite/fr_hsta.asp

 

[Jzoch]

CruiseLover - are you at wayne state som?

When I was givin the option to accept my stafford loans and do the enterance counceling in pipeline it suggested about 5 different lenders that i could borrow through.

I see that I am not able to view the lenders through pipeline anymore, but try going to the below web site. It is from WS SoM financial aid Web site under loan programs

https://www.collegelenderlist.com/content/lenderlist.asp?lsid=1067&s=MI&

 

[oldjeeps]

I have called the financial aid office, but I was told that I would have to speak to the individual lenders to see which loan would work best for me.

Sounds like their standard line - but if you spend some time just chatting with them they'll sometimes drop some hints as to which lender might fit your situation/goals best.

What I left with is: the debt is unavoidable, it is inevitable, just learn to deal with it.

All too true.

Oh yeah, i decided on citibank (currently - 2.77%/3.37 variable) vs. the AAMC Medloans. (4.7%/6.8% fixed). The credit/cash back incentive didn't add up to the no origination fee/lower interest rates.

Just a thought with what the fed has been up to over the last while (rates on the rise) you might want to reconsider going with a variable rate loan.
Also, my understanding (which might be wrong) was that all new Stafford loans were going to be fixed rate at 6.8% as of July of this year. So you might want to double check the info that citibank was giving you. Or even better check with fin aid/Ms. Moore to see if what citibank is telling you is consistent with the current Stafford loan rules.

 

[Jzoch]

You know i was wondering the same thing. I also thought that all federal stafford loans disbursed after July 1, 2006 were going to be 6.8% fixed. But on my MPN it did not indicate this. ?? At any rate after the rate reductions the interst will still be 4.55%.