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My understanding is that Federal Grad Plus Loans require a credit check. Is this done annually, semi-annually, or once, etc., or does it vary by school?
How Often Do Medical Schools Check Your Credit Report
- Thread starter knv2u
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deleted480308
What's the real question in the background here?
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it's annually
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Probably annually. My understanding is that you wouldn't be prevented from getting your loan unless something was seriously wrong, like defaulting on past student loans, getting foreclosed on, etc.
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I have an astronomical amount of medical debt, and am contemplating filing a personal bankruptcy. Interestingly, under federal law, a Chapter 13 bankruptcy is not considered an "adverse credit history" that would require a consigner for federal student loans. A Chapter 7 is. The problem is a Chapter 13 requires payments for 3-5 years (which would be hard to make during medical school), whereas a chapter 7 would end in about 2-3 months with no payments. If the answer was not annually, then it might be possible to start out as a Chapter 13 (for the credit check) and convert to a Chapter 7 afterward.
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deleted480308
I'd be wary of bankruptcy mid-school. If i were in your spot, I'd request minimal payments from my medical debt holders. "i owe you the money and I'll pay. But i'm dead broke for a few years so I'll pay $25/month until I graduate and then I can really speed it up." I've never had more than a feq minutes resistance to this. Just remind them you aren't hiding from the debt and they will get paid. Don't agree to interest. Offer a pay off for a significant reduction if you have suffi ient cash on hand. You are going to be a doctor, you can pay your debts
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Think about this - you should avoid bankruptcy as much as possible. Anything you do in the future will hang on this, including employers - aka residency.
Medical debt can always be renegotiated, and you have your future wages as a doctor - a powerful bargaining chip. Most of the time hospitals just want at least a portion of their money back and will be happy to negotiate down. In fact, I negotiated my medical bill to 1/3 with generous payment plan, even though I could pay it off. I have highly illiquid assets, so it's better to keep some cash reserve and perfect credit.
Just talk to them and say you're a broke medical student with lots of loans and no income - yet. Hospitals are generally happy to get more than pennies on the dollar when they get collection agencies involved and understand your high debt situation.
Second on not agreeing to high interest. Just hang the Chapter 13 in their face without actually going to do it, they'll see reason to consider a low interest balloon type payment plan while you're in medical school. You can easily get away with $25/month or something like that. Don't throw your credit down the drain unless it's a last resort. Bankruptcy records can still show up from a background check. Almost every employer, landlord, bank does several different checks. If not, they're generally out to screw you over.
Medical debt can always be renegotiated, and you have your future wages as a doctor - a powerful bargaining chip. Most of the time hospitals just want at least a portion of their money back and will be happy to negotiate down. In fact, I negotiated my medical bill to 1/3 with generous payment plan, even though I could pay it off. I have highly illiquid assets, so it's better to keep some cash reserve and perfect credit.
Just talk to them and say you're a broke medical student with lots of loans and no income - yet. Hospitals are generally happy to get more than pennies on the dollar when they get collection agencies involved and understand your high debt situation.
Second on not agreeing to high interest. Just hang the Chapter 13 in their face without actually going to do it, they'll see reason to consider a low interest balloon type payment plan while you're in medical school. You can easily get away with $25/month or something like that. Don't throw your credit down the drain unless it's a last resort. Bankruptcy records can still show up from a background check. Almost every employer, landlord, bank does several different checks. If not, they're generally out to screw you over.
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I would recommend getting professional financial advice or at least going to a finance forum. r/personalfinance on reddit is a decent place to get more opinions. Medical debt and bankruptcies are common discussions there
