How will my credit score affect loans for Dental School?

[BadgerPreDent93]

I had a sports injury during my senior year in high school and no insurance. I now have an unpaid medical bill for just under $3000 that is killing my credit score. However, unpaid medical bills get off your credit score in 7 years (so I have 3-4 left). I do not plan on buying a house or a car in that time period, so I am not too concerned about my credit score other than for loans for dental school. Will my bad credit score affect my ability to get student loans for dental school or will it cause me to get high interest rates? I lived frugally this year so I have excess student loan money from undergrad that I could use to pay the bill off (I was just going to pay the loan back with it), so I am trying to figure out if my best decision is to use the extra money to pay off the medical bill or to pay back my student loan.

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[ajj70]

You won't have an issue getting the student loans and if you pay off your medical debt this year, by the time you graduate from dental school, it will be a non-issue as long as you keep current on everything else and don't run up any credit card debt. Yes, those bills will still show up on your report for 7 years but if they have been paid off and you can explain what happened, it shouldn't hamper your chances of buying a house or whatever. Most mortgage people are going to wonder why an 18 year old was left holding the bag for medical bills in high school and paying off those bills while you were in college will play in your favor most likely. I would make payments on the bills if you don't have other income right now.

 

[BadgerPreDent93]

Well I can either use the money I have to pay the medical debt or to pay my undergrad student loan. By time I need to buy a house or car, the medical debt will be off my credit score anyways. I just don't want it to affect my chance of getting a good student loan in dental school if I decide not to pay it. Given the cost of dental school, a small percentage difference in a loan can easily amount to over the $3,000 it would cost me to pay the medical debt off. However, if I will get the same loans for dental school regardless of my credit score, then I would prefer to use my money to pay off my current student loans and just ignore the medical debt until it disappears from my credit score.

 

[ajj70]

Well I can either use the money I have to pay the medical debt or to pay my undergrad student loan. By time I need to buy a house or car, the medical debt will be off my credit score anyways. I just don't want it to affect my chance of getting a good student loan in dental school if I decide not to pay it. Given the cost of dental school, a small percentage difference in a loan can easily amount to over the $3,000 it would cost me to pay the medical debt off. However, if I will get the same loans for dental school regardless of my credit score, then I would prefer to use my money to pay off my current student loans and just ignore the medical debt until it disappears from my credit score.

Your current loans will go into deferment while you are in dental school if you so choose. Pay the medical debt. Having a charge-off on your report is not good and that might hurt you in the long run. For your first home especially, they don't just pull a credit report, they pull a credit history which will show the medical debt charge off. Also, it's not just your student loans you have to worry about, your credit report also goes for things like your auto insurance and a better report will give you lower rates. My parents work in the financial industry and this has been drummed into my head since birth!!

 

[austinpatton]

Student loans aren't like consumer loans. (I'm currently in finance) Student loans are easy to get, and many times the government makes sure they are easy to get.