how to manage student debt

[Esquire]

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Paying off med school debt with credit cards? Taking out federal loans to finance investments?

What could ever go wrong..

1. Credit card debt is dischargeable through bankruptcy, student loans are not.

2. Since she has a family, taking out fed student loans is wise. It's a form of insurance. In the event of death, fed student loans are 100% discharged. Her spouse/kids inherit that money. Plus, they pay no taxes on it, including the investment gains, because it's below the threshold for inheritance taxes.

Her mode of thinking is more akin to the average MBA, which is far beyond the scope of the average med student/doc who can't figure out a dollar from a hole in the ground.

 

[pathologyDO]

1. Credit card debt is dischargeable through bankruptcy, student loans are not.

2. Since she has a family, taking out fed student loans is wise. It's a form of insurance. In the event of death, fed student loans are 100% discharged. Her spouse/kids inherit that money. Plus, they pay no taxes on it, including the investment gains, because it's below the threshold for inheritance taxes.

Her mode of thinking is more akin to the average MBA, which is far beyond the scope of the average med student/doc who can't figure out a dollar from a hole in the ground.

Please, the average MBA couldn't figure out the perineum from the peritoneum

 

[Jabbed]

1. Credit card debt is dischargeable through bankruptcy, student loans are not.

2. Since she has a family, taking out fed student loans is wise. It's a form of insurance. In the event of death, fed student loans are 100% discharged. Her spouse/kids inherit that money. Plus, they pay no taxes on it, including the investment gains, because it's below the threshold for inheritance taxes.

Her mode of thinking is more akin to the average MBA, which is far beyond the scope of the average med student/doc who can't figure out a dollar from a hole in the ground.

Maybe it's just me and my financial naivete, but (1) preparing to take advantage of bankruptcy and (2) financing investments on the premise that it's free money once you're dead do not seem like sound investment strategies.

 

[Debt Free Doctor]

1. Credit card debt is dischargeable through bankruptcy, student loans are not.

2. Since she has a family, taking out fed student loans is wise. It's a form of insurance. In the event of death, fed student loans are 100% discharged. Her spouse/kids inherit that money. Plus, they pay no taxes on it, including the investment gains, because it's below the threshold for inheritance taxes.

Her mode of thinking is more akin to the average MBA, which is far beyond the scope of the average med student/doc who can't figure out a dollar from a hole in the ground.

Thank you for your compliment.
My dedicated doctor peers are more than capable of doing exactly the same if not more than I thought and did.
This is why I started the thread and my website.

I wanted to draw a little bit of their whole-hearted attention to patient care and training to become the best docs they can be from them, so that they too can enjoy financial freedom 🙂

I have the utmost respect for my peers, some of whom did double residency, IE completed 32rd grade...
I think they deserve to have financial freedom every bit as much as an average MBA. So let's keep the discussion going and help the financially broke physicians out.

 

[Debt Free Doctor]

Please, the average MBA couldn't figure out the perineum from the peritoneum

haha, due to being an immigrant, sometimes I still get the spelling wrong... even though I'm a doc.
we all just need to catch one another some slack!

 

[Debt Free Doctor]

Maybe it's just me and my financial naivete, but (1) preparing to take advantage of bankruptcy and (2) financing investments on the premise that it's free money once you're dead do not seem like sound investment strategies.

I totally agree.

I pay every one of my bills on time and sometimes (in advance) and would not ever want MY debt to be on the back of anyone else but mine 🙂

 

[Debt Free Doctor]

1. Credit card debt is dischargeable through bankruptcy, student loans are not.

2. Since she has a family, taking out fed student loans is wise. It's a form of insurance. In the event of death, fed student loans are 100% discharged. Her spouse/kids inherit that money. Plus, they pay no taxes on it, including the investment gains, because it's below the threshold for inheritance taxes.

Her mode of thinking is more akin to the average MBA, which is far beyond the scope of the average med student/doc who can't figure out a dollar from a hole in the ground.

In the event that I die, I do hope that my 7 year old daughter will NOT inherit my 30k of credit card debt. Could you please tell me a bit more about what would happen to my credit card debt if I do unfortunately pass?
I did sign up for life insurance so that my kid will have some money if I leave this world, and it's plenty to cover the credit card debt....

But death is definitely something I'm working really hard to avoid, since I'm the sole breadwinner for many people 🙂

 

[Hemorrage]

This thread made me think of a possible idea for those of us that don't have income from pre-med school or current.

1. Take out the maximum COA in loans
2. Use 0% APR card(s) to funnel maximum credit limit to paying back the loan servicer. For example, if the 0% card has a 5k limit, charge 5k and use that money to pay back the servicer.
3. Use the disbursement cash in the bank to micromanage the monthly payments

Of course this has to be elaborated on further to plan around the two disbursement cycles per year but could this work?

The only fault at the moment i can spot is finding a way to funnel credit line into cash. Amex Serve currently allows 1k/month credit card loads (fee free) meaning in 1 month you can convert 1k credit line into 1k cash to pay to the servicer. Thoughts?

 

[xffan624]

View attachment 190284

Great question.

Here's the rough break down. I tried digging for my records and found some. some are my best estimates...
Feel free to ask questions. I try running the numbers a couple times... but question away if something doesn't make sense.

I did live with my parents for 1 year and didn't have to pay rent & ate freely, got free babysitting for a year!

You got $100K in federal work study financial aid? Where do I get a work study job like that? Plus $35K from the parents is nice as well. Two things that many students cannot expect to receive.

I am also expecting to graduate from medical school debt free, but it's mostly thanks to veteran's benefits. My savings allow me not to have to live like a student again too much, something that is a bit unpalatable for someone who used to make $60-65K annually after taxes (as a single person with no dependents, that's plenty to live comfortably off of).

 

[Mass Effect]

Even merely removing interest is still money saved. For example, borrowing full CoA ~70k would be around $400 in interest every month- adding up to ~4500-4800 a year. Avoiding this interest for 12-18 months is still worthwhile.

That's irrelevant to @pathologyDO 's question. The question is that either way, the OP still graduated with around 200K in tuition debt, so how do you pay that down in less than a year? And the answer, apparently, is in ways that don't apply to 90% of med students, such as parental assistance to the tune of 35K and work study to the tune of 100K.

 

[Debt Free Doctor]

You got $100K in federal work study financial aid? Where do I get a work study job like that? Plus $35K from the parents is nice as well. Two things that many students cannot expect to receive.

I am also expecting to graduate from medical school debt free, but it's mostly thanks to veteran's benefits. My savings allow me not to have to live like a student again too much, something that is a bit unpalatable for someone who used to make $60-65K annually after taxes (as a single person with no dependents, that's plenty to live comfortably off of).

Nice!

My parents didn't give me 35k...
I gave them 35k+ when I was in college to support them.

35k came from another generous family member.
So I guess what goes around comes around 🙂

100k of work study is about 30hrs/ week over 4 years.
I did most of the work at library where I got to study and even tutored and made double income for a given hour...

I think I did work more hours than most people would in med school.
But I think it is quite doable for someone to work half of the hours.
15-20 hours of work study is quite manageable, especially if you get to study most of these hours 🙂 That will still amount to $62400 in income just from the work study...

That's $62400 you didn't have to borrow and accrue interest on!

 

[Debt Free Doctor]

Amex Serve currently allows 1k/month credit card loads (fee free) meaning in 1 month you can convert 1k credit line into 1k cash to pay to the servicer. Thoughts?

This is an awesome piece of info. thanks!

Not sure about the rest of the plan...
Why would you have to get the max COA in the first place?
The max COA means the max loan origination fee & the max principle that will accrue interest starting from day 1 of disbursement.

If I misunderstood your proposal, please correct me...
Thanks!

 

[pathologyDO]

Nice!

My parents didn't give me 35k...
I gave them 35k+ when I was in college to support them.

35k came from another generous family member.
So I guess what goes around comes around 🙂

100k of work study is about 30hrs/ week over 4 years.
I did most of the work at library where I got to study and even tutored and made double income for a given hour...

I think I did work more hours than most people would in med school.
But I think it is quite doable for someone to work half of the hours.
15-20 hours of work study is quite manageable, especially if you get to study most of these hours 🙂 That will still amount to $62400 in income just from the work study...

That's $62400 you didn't have to borrow and accrue interest on!

Isn't work study only for those deemed financially disadvantaged and requires FAFSA application to apply?

So let me get this straight, the rest of your money making ideas include $35k from family, $20k money from working prior to school, $16k scholarships, $20k government assistance, and $100,000 work study. The underlined are things that are only for people with really high scores (scholarships) or people that are disadvantaged economically.

I really think that we can use people like you that share ways to make money during medical school around here, that part I like. I however find it somewhat offensive that you are bringing this success story, yet you clearly have had a very significant amount of help from the government, tax payers, and other people to get to where you are and haven't included that information from the get go -> something I feel comes across as being disingenuous. I'm not trying to say you haven't worked for anything because clearly you're smart and have worked hard.

 

[Debt Free Doctor]

Right. Looking at that breakdown...if you eliminate the magic 100K work study aid then all this adds up to basically exactly the average graduate's debt (100K work-study + 53K personal loan + 28K credit card balance = 181K total; AAMC average = 180k ).

I'd say I was pretty average myself too.
All I did was work extra, be frugal and used the credit card to help me out.
Never tried to make this sound like magic.
Just didn't compiled all the numbers until I was asked.

Again, my intention when starting a thread as such was to bring awareness to debt prevention/minimization...
I never claimed to have a magic recipe. As recalled, everyone on SDN called magic recipe FRAUD, right? 😉

If you think I basically have nothing to offer anymore, I'd be more than happy to shut up, too!
I appreciate everyone's input and ideas though 🙂

 

[Debt Free Doctor]

Isn't work study only for those deemed financially disadvantaged and requires FAFSA application to apply?

So let me get this straight, the rest of your money making ideas include $35k from family, $20k money from working prior to school, $16k scholarships, $20k government assistance, and $100,000 work study. The underlined are things that are only for people with really high scores (scholarships) or people that are disadvantaged economically.

I really think that we can use people like you that share ways to make money during medical school around here, that part I like. I however find it somewhat offensive that you are bringing this success story, yet you clearly have had a very significant amount of help from the government, tax payers, and other people to get to where you are and haven't included that information from the get go -> something I feel comes across as being disingenuous. I'm not trying to say you haven't worked for anything because clearly you're smart and have worked hard.

Isn't work study only for those deemed financially disadvantaged and requires FAFSA application to apply?

I did use FAFSA every year...
I think they deem everyone in med school financially disadvantaged as long as they don't have income matching COA? I am not exactly sure how they calculate everything...

I filled in the FAFSA form as directed, and got fixed amount of work study.

Worked all the hours off, and requested for more during each trimester. Sometimes I get more award hours after getting on the waitlist at my school... the financial aid counselor re-distribute the left over work study funds that other students don't use to those who finished working their hours...

Not sure what other people do when they finish working their work study... or if they ever fully maximize working all the hours awarded to them.

Yeah, I did well on tests to get scholarships.

 

[pathologyDO]

Isn't work study only for those deemed financially disadvantaged and requires FAFSA application to apply?

I did use FAFSA every year...
I think they deem everyone in med school financially disadvantaged as long as they don't have income matching COA? I am not exactly sure how they calculate everything...

I filled in the FAFSA form as directed, and got fixed amount of work study.

Worked all the hours off, and requested for more during each trimester. Sometimes I get more award hours after getting on the waitlist at my school... the financial aid counselor re-distribute the left over work study funds that other students don't use to those who finished working their hours...

Not sure what other people do when they finish working their work study... or if they ever fully maximize working all the hours awarded to them.

Yeah, I did well on tests to get scholarships.

Wow, you totally glossed over the point of my post.

 

[Debt Free Doctor]

Isn't work study only for those deemed financially disadvantaged and requires FAFSA application to apply?

So let me get this straight, the rest of your money making ideas include $35k from family, $20k money from working prior to school, $16k scholarships, $20k government assistance, and $100,000 work study. The underlined are things that are only for people with really high scores (scholarships) or people that are disadvantaged economically.

I really think that we can use people like you that share ways to make money during medical school around here, that part I like. I however find it somewhat offensive that you are bringing this success story, yet you clearly have had a very significant amount of help from the government, tax payers, and other people to get to where you are and haven't included that information from the get go -> something I feel comes across as being disingenuous. I'm not trying to say you haven't worked for anything because clearly you're smart and have worked hard.

by the way, I having the feeling that somehow I left a bad taste in your mouth...
I apologize for that.

I was simply excited when I saw that I paid off my student loans and wanted to share anything I have to offer so that others can reduce their debt too...

Maybe I should have just kept my mouth shut instead.
I'm not sure what I should have done...
I've tried to answer all questions as they come.
I simply did not think I needed to present a full portfolio at the beginning of the post when I'm not selling anything...

Success story? I am grateful for the hard work of 30+ hrs I worked on top of a regular full time med student schedule.

I tried my best and everyone can take what they want from this thread.

I have fully accepted a full spectrum of "she's full of BS, that doesn't apply to me" to "she's just another average med resident, nothing she can offer with all her rambling."

I wish all you the very best; I appreciate the useful information some of you've shared as well!

 

[Debt Free Doctor]

Wow, you totally glossed over the point of my post.

sorry not sure what point you are making...
maybe I'm just having NF delirium.
I think I should get some sleep and apologize if I seemed dense. I did read over your post 3 times...

 

[Stagg737]

by the way, I having the feeling that somehow I left a bad taste in your mouth...
I apologize for that.

I was simply excited when I saw that I paid off my student loans and wanted to share anything I have to offer so that others can reduce their debt too...

Maybe I should have just kept my mouth shut instead.
I'm not sure what I should have done...
I've tried to answer all questions as they come.
I simply did not think I needed to present a full portfolio at the beginning of the post when I'm not selling anything...

Success story? I am grateful for the hard work of 30+ hrs I worked on top of a regular full time med student schedule.

I tried my best and everyone can take what they want from this thread.

I have fully accepted a full spectrum of "she's full of BS, that doesn't apply to me" to "she's just another average med resident, nothing she can offer with all her rambling."

I wish all you the very best; I appreciate the useful information some of you've shared as well!

I think you've offered some interesting insights in this thread that can give some future students ideas on how minimize debt. Most students do not realize the impact that working a job (even if it's a tutoring job that requires 5 hrs/week)can have on their overall debt.

The only remaining point I have criticism for is the 100k work-study number. Not all students who don't have an income = to COA are considered disadvantaged. My total income last year was only around 11k and I did not qualify for the maximum amount of student loans (though it was pretty close to that). Most schools do not offer $15 or $20/hr or however much you were making. I currently make $10/hr and I don't know anyone at any med school that makes as much as I do through their school. Most people I know are paid whatever the minimum wage in that state is. We also only average about 7 hrs/wk.

Let's assume though, that someone makes 10/hr and is able to work 15 hrs/wk, which I think is generous, but not unreasonable. If you work the ~40 weeks that school is in session, then you're making 40x15x$10= 6k/year. That translates to about 24k over the course of all 4 years. That's a pretty substantial number, but it's a far cry from the 100k you were able to make. Also, many people may not have the time or ability to continue that job during the clinical years due to away rotations, interviews, late hours, etc. So they will likely make even less than that.

I'm not saying one shouldn't do work-study, as it's a great way to make some extra money and save a little in the long run. I just don't think it's realistic for the vast majority of students to be able to make 100k or even 35-40k in a program like that.

 

[Red Lobster Actual]

If there's one take-home point from her experience, it should be: get resourceful.

Ditto. Med school and residency will never teach you about finances and money. They wave a wand telling you (if they ever talk about it) it will all be ok in the end and maybe it will...maybe not. It is entirely up to the medical student to educate themselves about finance.

Will the OP's specific advice work for everyone? No. The majority? Probably not. But it worked for her and with even a resident's salary she is much better off than from where she was 5 years ago. I completely agree with RangerBob, the specifics might not work for all but the moral of learning about finance and it's fine print and applying it to your situation is of paramount importance to everyone.

I think it has been mentioned before but good job OP, graduating med school with relatively little debt while raising a kid is no small feat. Looking forward to your article on white coat investor's website later this summer.

 

[sazerac]

@Debt Free Doctor I just have one additional question:

Would you describe yourself as one happy Chinese girl?

 

[Debt Free Doctor]

Ditto. Med school and residency will never teach you about finances and money. They wave a wand telling you (if they ever talk about it) it will all be ok in the end and maybe it will...maybe not. It is entirely up to the medical student to educate themselves about finance.

Will the OP's specific advice work for everyone? No. The majority? Probably not. But it worked for her and with even a resident's salary she is much better off than from where she was 5 years ago. I completely agree with RangerBob, the specifics might not work for all but the moral of learning about finance and it's fine print and applying it to your situation is of paramount importance to everyone.

I think it has been mentioned before but good job OP, graduating med school with relatively little debt while raising a kid is no small feat. Looking forward to your article on white coat investor's website later this summer.

So nice to hear a positive voice!
Thanks 🙂

I look forward to lots more discussion with future posts on my website, on white coat or here!

 

[Debt Free Doctor]

@Debt Free Doctor I just have one additional question:

Would you describe yourself as one happy Chinese girl?

Yeah! Thanks 🙂

I'm pretty happy and enthusiastic, easily humored and overall low maintenance

Lol

 

[Debt Free Doctor]

I think you've offered some interesting insights in this thread that can give some future students ideas on how minimize debt. Most students do not realize the impact that working a job (even if it's a tutoring job that requires 5 hrs/week)can have on their overall debt.

The only remaining point I have criticism for is the 100k work-study number. Not all students who don't have an income = to COA are considered disadvantaged. My total income last year was only around 11k and I did not qualify for the maximum amount of student loans (though it was pretty close to that). Most schools do not offer $15 or $20/hr or however much you were making. I currently make $10/hr and I don't know anyone at any med school that makes as much as I do through their school. Most people I know are paid whatever the minimum wage in that state is. We also only average about 7 hrs/wk.

Let's assume though, that someone makes 10/hr and is able to work 15 hrs/wk, which I think is generous, but not unreasonable. If you work the ~40 weeks that school is in session, then you're making 40x15x$10= 6k/year. That translates to about 24k over the course of all 4 years. That's a pretty substantial number, but it's a far cry from the 100k you were able to make. Also, many people may not have the time or ability to continue that job during the clinical years due to away rotations, interviews, late hours, etc. So they will likely make even less than that.

I'm not saying one shouldn't do work-study, as it's a great way to make some extra money and save a little in the long run. I just don't think it's realistic for the vast majority of students to be able to make 100k or even 35-40k in a program like that.

I see our schools workstudy was 15/hr

I wasn't aware of the hourly rate being different all over the country
Prob proportional to cost of living....

 

[Dr.Tao]

Just want to thank DFD for her advice and offer 3 observations/comments. First, a lot of people are troubled that as am immigrant and worse a woman, you're "wining" the "game" the ancestors/parents of most folks on this site have been playing for YEARS. Wall Street(AKA legalized gambling/the ultimate shell game), Donal Trump, it ALL looks the same to me.

Second, write a book, claim intellectual property (or whatever the legal term is) ASAP before someone claims your ideas as their own, and you see it next on Suzie Orman's TV show.

Third, get PAID for your advice like the MBAs do.

Thanks again, and continued success!!!

 

[Debt Free Doctor]

Just want to thank DFD for her advice and offer 3 observations/comments. First, a lot of people are troubled that as am immigrant and worse a woman, you're "wining" the "game" the ancestors/parents of most folks on this site have been playing for YEARS. Wall Street(AKA legalized gambling/the ultimate shell game), Donal Trump, it ALL looks the same to me.

Second, write a book, claim intellectual property (or whatever the legal term is) ASAP before someone claims your ideas as their own, and you see it next on Suzie Orman's TV show.

Third, get PAID for your advice like the MBAs do.

Thanks again, and continued success!!!

Wow, U r very keen!
This is helpful information to me 🙂

 

[Mass Effect]

Just want to thank DFD for her advice and offer 3 observations/comments. First, a lot of people are troubled that as am immigrant and worse a woman, you're "wining" the "game" the ancestors/parents of most folks on this site have been playing for YEARS

Oh please, can it with the troll bait. The criticisms posted were all legitimate and now that the thread has pretty much played out, I tend to go by my initial observation.

 

[fancymylotus]

Pretty sure the OPs desire to get paid for their advice is the source of most of our skepticism

TMNSS, I should give out financial advice. Invest in Loubs and diamonds. Thank me later.


(Where did she say she wants to get paid for her advice?)

 

[Red Lobster Actual]

She didn't but the incessant blog linking is a strong clue

I managed to find the OP's website. No store. No 10 steps to riches with real estate book. There isn't even an ad on it.

EDIT: Yet... 🙂

 

[Red Lobster Actual]

There were links to multiple self published books

Ah...yea I see it now. All about the MCAT, USMLE, and the Match though. I stand corrected.

 

[Debt Free Doctor]

I submit to you that we re-direct our energy to sharing with one another how to minimize our debt... or better still, how to build positive net worth.

I'm in the process of "trying" to buy a second house, but that's very stressful and I most likely won't manage to buy this particular house that I think would be a dream home for my parents.

I feel a bit discouraged but at the same time know that I have been trying my best.

If anyone has house buying experience or tips, please do share!

Since some of you think that I have nothing to offer (that I'm either mediocre or fraudulent), why not offer something to SDN from YOUR experience?

As I have stated repeatedly... I'd like to learn from SDN 🙂

the thread is called "how to manage student debt,"
NOT how "DFD" managed student debt...

I just would like to see useful discussion. Especially for those who think that it has NOT been useful, why not the be the change yourself?
My ears are open.

PS. I am sorry that I do very much appreciate positive/constructive criticism. Pat on the back, etc. whatever you'd like to call it.

 

[Red Lobster Actual]

Pretty sure the OPs desire to get paid for their advice is the source of most of our skepticism

To be fair though the same kind of skepticism should be extended to Dr. White Coat Investor (WCI) as well. Heck, he has a bunch of ads, links to his book, and disclaimers on making commissions from Amazon. However, at this point his website and information is so good nobody here would think twice about what he writes. Back in the day though, I'm sure some of his earlier works might have been around the same level as what we are seeing with OP's information and website now. Things like this takes time to mature. If OP is truly under the tutelage of WCI I bet he just told her to start getting the word out about her website so she hopefully can at a certain point hit critical mass and turn her experiences into a source of passive income. The American Dream right there. So long as the information is helpful I can't fault that. Plus she seems to be putting all she knows online for free just like WCI.

I think she'll have some interesting and different perspectives from WCI as she continues writing. WCI managed to get out of med school debt free by taking the American equivalent of the King's shilling. Not for everyone. OP was a dirt poor peasant like myself. A good chunk of medical students. Plus she raised a kid during school. A small fraction of students but they are there. Even if her views can't help the majority of medical students, if she can help the fraction of truly financially strapped medical students leave with little debt...well...I think that's a win win there.

 

[Debt Free Doctor]

To be fair though the same kind of skepticism should be extended to Dr. White Coat Investor (WCI) as well. Heck, he has a bunch of ads, links to his book, and disclaimers on making commissions from Amazon. However, at this point his website and information is so good nobody here would think twice about what he writes. Back in the day though, I'm sure some of his earlier works might have been around the same level as what we are seeing with OP's information and website now. Things like this takes time to mature. If OP is truly under the tutelage of WCI I bet he just told her to start getting the word out about her website so she hopefully can at a certain point hit critical mass and turn her experiences into a source of passive income. The American Dream right there. So long as the information is helpful I can't fault that. Plus she seems to be putting all she knows online for free just like WCI.

I think she'll have some interesting and different perspectives from WCI as she continues writing. WCI managed to get out of med school debt free by taking the American equivalent of the King's shilling. Not for everyone. OP was a dirt poor peasant like myself. A good chunk of medical students. Plus she raised a kid during school. A small fraction of students but they are there. Even if her views can't help the majority of medical students, if she can help the fraction of truly financially strapped medical students leave with little debt...well...I think that's a win win there.

Wow thank you!!!!
Some of the skeptic out here may think u r my promoter or manger, lol

Dirt poor is petty accurate to describe most of my financial life so far 🙂
But I am grateful that it has taught me to be creative and positive!

 

[pathologyDO]

Not that it is common to be prosecuted for lying about your income, but I compel everyone to keep this in mind if you're thinking about using this credit card advice:

"But if you apply for a credit card, especially during difficult economic times that might give rise to temptation, you should find it sobering to know that substantially inflating or, theoretically, even slightly embellishing your reported income can get you prosecuted under federal bank fraud statutes. The penalty is up to 30 years in federal prison and a fine of up to $1 million, for each instance.
"The federal statute does make it a crime to submit any false financial information to most banks and it does get used, from time to time, for these kinds of prosecutions," said John Rao, an attorney for the National Consumer Law Center, a Boston-based group that focuses on consumer credit and bankruptcy issues.

Uncommon is the bank or other credit card issuer that doesn't have some connection to the Federal Reserve Board or other element of the federal banking system, thus putting that card issuer -- and anyone who applies to it for credit -- under the expansive reach of federal law.

"The scope of that statute is pretty broad because so many financial institutions are somehow affiliated with a national bank," Roa said.

The statute covers oral or written false statements or misrepresentations knowingly made on a loan or credit application to an insured bank. The statements or misrepresentations must have been capable of influencing the bank's credit decision, though the applicant can be charged even if the loan wasn't approved.


Read more: http://www.creditcards.com/credit-c...card-application-fraud-1282.php#ixzz3UhhuKl2P
Follow us: @CreditCardsCom on Twitter | CreditCards.com on Facebook
Compare credit cards here - CreditCards.com"

retrieved from: http://www.creditcards.com/credit-c...ing-on-credit-card-application-fraud-1282.php

 

[pathologyDO]

Also, someone mentioned that this method allows you to file bankruptcy and provide relief of your debt, whereas federal student loan debt cannot be ameliorated through this avenue. If a court finds out that you lied about your income on the credit card applications when you file for bankruptcy, they can deny you the ability to write off the debt.

 

[Dr.Tao]

Oh please, can it with the troll bait. The criticisms posted were all legitimate and now that the thread has pretty much played out, I tend to go by my initial observation.

Jealous because you're in a $hit load of student loan debt, LOL???

KUDOS to the OP, she' s on her way to working for her d*mn self one day, unlike 99.99% of you guys!!!

PS- Yeah, I got my own business too! 😉

 

[Dr.Tao]

I'm just wondering since there's so much concern about lying, how many of you lied on your apps to med school/residency with all that bs about practicing in rural areas, when you had concierge Derm in mind all along?

Please save the sanctimonious criticisms for the top 1% where it's VERY well deserved, most people lied/stretched the truth about something at some point, to get to the "Dr" title too!.

 

[jeffk805dent]

so somehow lying on med school/residency apps (which will eventually catch up to the person lying) is equivalent to lying on a credit card application (the lying person may not even get detected)

 

[W19]

I submit to you that we re-direct our energy to sharing with one another how to minimize our debt... or better still, how to build positive net worth.

I'm in the process of "trying" to buy a second house, but that's very stressful and I most likely won't manage to buy this particular house that I think would be a dream home for my parents.

I feel a bit discouraged but at the same time know that I have been trying my best.

If anyone has house buying experience or tips, please do share!

Since some of you think that I have nothing to offer (that I'm either mediocre or fraudulent), why not offer something to SDN from YOUR experience?

As I have stated repeatedly... I'd like to learn from SDN 🙂

the thread is called "how to manage student debt,"
NOT how "DFD" managed student debt...

I just would like to see useful discussion. Especially for those who think that it has NOT been useful, why not the be the change yourself?
My ears are open.

PS. I am sorry that I do very much appreciate positive/constructive criticism. Pat on the back, etc. whatever you'd like to call it.

I do have a home buying experience(s)... The key to get a good deal when buying a home is to be patient... It took me about a year and 3 realtors to get the house in the location I wanted because it was going to be an investment property. I did not want to make a bad investment with the little saving that I had. The investment is paying off big time so far... The mortgage term is for 15 years... I make over $200/month after paying the mortgage/tax/insurance/maintenance/property manager etc... from the investment while building equity... I have been putting that $200 for over 3 years aside, so if there is major repair that needs to be done, I can use that money to do it... In the next few months, I am going to start applying that $200 to the principal until the house is completely paid off... I purchased the house for 150k and it worth over 260k right and my mortgage balance is less than 100k now. I should be on track to pay it off by the time I am done with residency since I am a MS1...

One of my reasonings when I purchased that house was that instead of using that money (40k) for living expense while in med school, why don't I make that money work for me so I can come out a little bit ahead when I become an attending... Things have been working so far pretty well. Lets see what the next few years will bring... I am a non trad student and I might not be risk averse like most traditional med students...

 

[W19]

People have to be creative sometimes... I made other investment that most financial advisers would advise against, but they work for me... As long as you do your homework and know the risk involved, be creative and make your money works for you...

 

[Debt Free Doctor]

Not that it is common to be prosecuted for lying about your income, but I compel everyone to keep this in mind if you're thinking about using this credit card advice:

"But if you apply for a credit card, especially during difficult economic times that might give rise to temptation, you should find it sobering to know that substantially inflating or, theoretically, even slightly embellishing your reported income can get you prosecuted under federal bank fraud statutes. The penalty is up to 30 years in federal prison and a fine of up to $1 million, for each instance.
"The federal statute does make it a crime to submit any false financial information to most banks and it does get used, from time to time, for these kinds of prosecutions," said John Rao, an attorney for the National Consumer Law Center, a Boston-based group that focuses on consumer credit and bankruptcy issues.

Uncommon is the bank or other credit card issuer that doesn't have some connection to the Federal Reserve Board or other element of the federal banking system, thus putting that card issuer -- and anyone who applies to it for credit -- under the expansive reach of federal law.

"The scope of that statute is pretty broad because so many financial institutions are somehow affiliated with a national bank," Roa said.

The statute covers oral or written false statements or misrepresentations knowingly made on a loan or credit application to an insured bank. The statements or misrepresentations must have been capable of influencing the bank's credit decision, though the applicant can be charged even if the loan wasn't approved.


Read more: http://www.creditcards.com/credit-c...card-application-fraud-1282.php#ixzz3UhhuKl2P
Follow us: @CreditCardsCom on Twitter | CreditCards.com on Facebook
Compare credit cards here - CreditCards.com"

retrieved from: http://www.creditcards.com/credit-card-news/legal-consequences-of-lying-on-credit-card-application-fraud-1282.php

Thank you for bringing this information to the thread.
While it is good to utilize credit card to one's benefit in reducing interest accrued and making some side cash, it is NOT worth it to lie on the application.

There are SO SO SO many credit card companies, one can report Truthfully on their income and still have quite a large TOTAL credit limit because another factor is the sheer # of credit cards one hold simultaneously.

For instance, a med student with a side job may get approved for 5k by EACH of the credit cards she/he applies to.

If you just count the major banks (Chase, BOA, discover, citi, Amex, Capitol One, Compass), that's 35k in total limit.

Also, each major bank has multiple card offers, ie. for chase you can get SOUTHWEST, SLATE, FREEDOM, SAPPHIRE, INK, AMAZON etc.

So even if your income only gets you qualify for 5k on ONE card. You can just as well have a total credit limit of 100k from 20 cards 🙂

The trick is, HOW TO TIME the credit card application, so you don't catastrophically lower your credit score!

And there is no ONE WAY to time your credit card utilization and application, it's completely up to your style and your comfort level and knowing when you want to stretch your credit and when you don't as mentioned in prior posts.

 

[Debt Free Doctor]

Also, someone mentioned that this method allows you to file bankruptcy and provide relief of your debt, whereas federal student loan debt cannot be ameliorated through this avenue. If a court finds out that you lied about your income on the credit card applications when you file for bankruptcy, they can deny you the ability to write off the debt.

Great information.

Racking up debt with the intent to NOT pay it off is detrimental--I think of it as selling one's soul.
It does no good to your conscience and does not set a good example for your children.

While there are people who get away with intentionally leaving their BILL on someone else's back, I simply sleep best at night knowing I paid ALL my bills myself.

Since we can't rely completely on honor system, it is good that there are law/rules as mentioned by pathologyDO that will prevent such immoral intention/actions.

 

[Debt Free Doctor]

I do have a home buying experience(s)... The key to get a good deal when buying a home is to be patient... It took me about a year and 3 realtors to get the house in the location I wanted because it was going to be an investment property. I did not want to make a bad investment with the little saving that I had. The investment is paying off big time so far... The mortgage term is for 15 years... I make over $200/month after paying the mortgage/tax/insurance/maintenance/property manager etc... from the investment while building equity... I have been putting that $200 for over 3 years aside, so if there is major repair that needs to be done, I can use that money to do it... In the next few months, I am going to start applying that $200 to the principal until the house is completely paid off... I purchased the house for 150k and it worth over 260k right and my mortgage balance is less than 100k now. I should be on track to pay it off by the time I am done with residency since I am a MS1...

One of my reasonings when I purchased that house was that instead of using that money (40k) for living expense while in med school, why don't I make that money work for me so I can come out a little bit ahead when I become an attending... Things have been working so far pretty well. Lets see what the next few years will bring... I am a non trad student and I might not be risk averse like most traditional med students...

Wow, thank you!
That's both inspiring and exciting to hear 🙂

Why not let your money work for you, so that you can work voluntarily and at will!

That's amazing that you have 160k of house equity as a med student. I wish I bought something in med school too instead of paying 1000's of dollars into rent, with nothing to show for it at the end of 4 years.

You are totally right, patience is key.

I have 30k cash now. The part of me that wants to buy a 2nd house with this is purely emotionally driven by "I want to take are of my parents. I want to pamper my parents, give them stability, and give them their FIRST home."

However, I have not seen the most incredible value that will justify buying a 2nd house rationally and financially.

Could you please share more on how you do your homework before deciding which house to buy?

Clearly, you have chosen so wisely that you have out-performed 99.99% of the home buyers!!!!

Thanks again for bringing something useful to this thread!

 

[Debt Free Doctor]

People have to be creative sometimes... I made other investment that most financial advisers would advise against, but they work for me... As long as you do your homework and know the risk involved, be creative and make your money works for you...

Please please elaborate!

 

[Mass Effect]

I submit to you that we re-direct our energy to sharing with one another how to minimize our debt... or better still, how to build positive net worth.

I'm in the process of "trying" to buy a second house, but that's very stressful and I most likely won't manage to buy this particular house that I think would be a dream home for my parents.

I feel a bit discouraged but at the same time know that I have been trying my best.

If anyone has house buying experience or tips, please do share!

Since some of you think that I have nothing to offer (that I'm either mediocre or fraudulent), why not offer something to SDN from YOUR experience?

As I have stated repeatedly... I'd like to learn from SDN 🙂

the thread is called "how to manage student debt,"
NOT how "DFD" managed student debt...

I just would like to see useful discussion. Especially for those who think that it has NOT been useful, why not the be the change yourself?
My ears are open.

PS. I am sorry that I do very much appreciate positive/constructive criticism. Pat on the back, etc. whatever you'd like to call it.

Not to revisit all the back-and-forth once again, but if you really want to know, the reason people are skeptical is because your story keeps changing. A perfect example is the above. First, you said that you were going to buy your parents a home in 8-9 years. Now you're saying you're in the process of buying it now. Also, you said that it's perfectly acceptable to you to lie about your income on a credit card application and then you turned around and agreed with people who said that it's a crime and that you shouldn't do that. If you want to be taken seriously, it would help to have one story and stick to it.

Jealous because you're in a $hit load of student loan debt, LOL???

KUDOS to the OP, she' s on her way to working for her d*mn self one day, unlike 99.99% of you guys!!!

PS- Yeah, I got my own business too! 😉

The OP supposedly is debt-free with the help of others, not through some genius scheme. The scheme, which is unethical at best and criminal at worst, only eliminated interest, not the debt. I highly doubt anyone here is jealous of her or you.

 

[Debt Free Doctor]

I'm just wondering since there's so much concern about lying, how many of you lied on your apps to med school/residency with all that bs about practicing in rural areas, when you had concierge Derm in mind all along?

Please save the sanctimonious criticisms for the top 1% where it's VERY well deserved, most people lied/stretched the truth about something at some point, to get to the "Dr" title too!.

I like your TRUE honesty.
NO hypocrisy from you!
I appreciate it 🙂

 

[xffan624]

I'm just wondering since there's so much concern about lying, how many of you lied on your apps to med school/residency with all that bs about practicing in rural areas, when you had concierge Derm in mind all along?

Please save the sanctimonious criticisms for the top 1% where it's VERY well deserved, most people lied/stretched the truth about something at some point, to get to the "Dr" title too!.

One lie on an application is a federal crime, one lie is not. Can you tell which one is which?

 

[Debt Free Doctor]

Not to revisit all the back-and-forth once again, but if you really want to know, the reason people are skeptical is because your story keeps changing. A perfect example is the above. First, you said that you were going to buy your parents a home in 8-9 years. Now you're saying you're in the process of buying it now. Also, you said that it's perfectly acceptable to you to lie about your income on a credit card application and then you turned around and agreed with people who said that it's a crime and that you shouldn't do that. If you want to be taken seriously, it would help to have one story and stick to it.



The OP supposedly is debt-free with the help of others, not through some genius scheme. The scheme, which is unethical at best and criminal at worst, only eliminated interest, not the debt. I highly doubt anyone here is jealous of her or you.

Yes I PLANED to buy my parents a home in 8 years after paying off my own in 7 years.

But I saw this house in our neighborhood that is one street away from my home, that has the dream kitchen that my mother would love.
The seller just dropped another 30k... I couldn't resist.

So I started working on a doctor's loan to make an offer only to realize that it's IMPOSSIBLE because of my low income as a pgy1. I simply won't be able to qualify because the loan officer can't believe that I am THAT frugal and can pay for 2 houses with rental income from one + pgy1 salary.

I did not meet the 38% debt to income ratio because my denominator (income) is just too small and I do have the 30k credit card debt as well.

I was very sad that I could not buy THIS house for my parents NOW.
But everyone was talking me out of it anways.
Anyone who's rational can see that the best use of my money right now is to fund retirement since I don't have any saved up yet and I'm 30.

I have definitely gone back and forth in my mind regarding my own financial goals.
Thanks for holding me accountable.
I should stick with buying my parents house AFTER I become an attending, not now.

As tempting as that house is, I have accepted that I am not in the position to buy it now.

If I were to buy it, I would have to work extra hours in tutoring to pay for it.
And I enjoy quality tutoring and quality family time too much to be working more than I do now.

Regarding the credit card application...
I'm a goodie two shoes and always nervous about getting in trouble.
So I do as I'm instructed on the credit card application, and like some posters said, I had even called in at times to ask question regarding what I can and can not count as income...

But if you want to stick with the story that I'm a liar, feel free.

 

[W19]

When I said be creative, I meant people sometimes have to act against the conventional wisdom... I know people who took money from their 401k to invest in the housing market in 2011 when financial advisers were telling them not do it, and they are reaping big rewards now...

 

[Dr.Tao]

One lie on an application is a federal crime, one lie is not. Can you tell which one is which?

My point is that a liar is a liar is a liar. Can you tell which one is which? Or are you an Atheist?