Med school loans?

Started by Revolver1045
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Revolver1045

Revolver1045

Full Member
10+ Year Member
Hey guys,

So my undergrad was completely free and I've never had to take out a loan. Besides having a checking and savings account I have no idea how banks, loans etc. work (except for the extrememly rudimentary knowledge I have from reading and watching the news). I know, its shameful that i have no idea about this stuff. Kind of thinking about getting a degree in finance after med school or if the school i go to has an md/bs program. Thats besides the point. Now that I will hopefully be going to med school I will be paying full price besides scholarships that I apply for. My question is how do med school loans work? How much can you take out a year? When do you have to start paying them back? I guess a general overview would be best. Thanks in advance.
 
Use the search function...

But since I'm bored...

All federal stafford loans are unsubsidized, meaning interest accrues while you are in school. Currently the rate on federal stafford loans is 6.5%. The maximum you can take out in a year is about 42,000. Anything above that amount will need to be in grad plus (credit based and higher interest rate) or private loans (should be a last resort). Repayment begins during your internship year (first year of residency) and is income based (IBR).
 
Ironmandoc said:
Use the search function...

But since I'm bored...

All federal stafford loans are unsubsidized, meaning interest accrues while you are in school. Currently the rate on federal stafford loans is 6.5%. The maximum you can take out in a year is about 42,000. Anything above that amount will need to be in grad plus (credit based and higher interest rate) or private loans (should be a last resort). Repayment begins during your internship year (first year of residency) and is income based (IBR).
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6.8% i believe
 
Thanks much. So if I have no credit (that I know of) how will I go about getting a grad plus loan? My parents have great credit could they cosign? And why are private loans a last resort?
 
Revolver1045 said:
Thanks much. So if I have no credit (that I know of) how will I go about getting a grad plus loan? My parents have great credit could they cosign? And why are private loans a last resort?
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You don't need to have a credit score to receive a grad plus loan.
 
premed21 said:
You don't need to have a credit score to receive a grad plus loan.
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You actually do need good credit for a grad plus loan...if you don't have any credit than you should have your parents (who should have good credit) to cosign.
 
Revolver1045 said:
Thanks much. So if I have no credit (that I know of) how will I go about getting a grad plus loan? My parents have great credit could they cosign? And why are private loans a last resort?
Click to expand...

Your parents will need to cosign.

Private loans are undesirable because they tend to carry higher interest rates and require good credit. Many can also have variable interest rates, which are less than desirable. I wouldn't say private loans should be avoided at all costs, but you should know what you're going into before you sign the promissory note.

(sent from my phone - please forgive typos and brevity)
 
NickNaylor said:
Your parents will need to cosign.

Private loans are undesirable because they tend to carry higher interest rates and require good credit. Many can also have variable interest rates, which are less than desirable. I wouldn't say private loans should be avoided at all costs, but you should know what you're going into before you sign the promissory note.

(sent from my phone - please forgive typos and brevity)
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What if you don't have anyone willing to co-sign for a grad plus loan? Are you screwed?
 
If you have good credit--I would recommend seeking a private loan. Discover Health Loans for example are at 3.25% right now I believe. Check the most up to date information.

If you have poor credit--federal loans + parentPLUS (I think that's what they are called) is the way to go.

It's a joke that Uncle Sam wants 6.8%. Unbelievable.
 
LaughingMan said:
If you have good credit--I would recommend seeking a private loan. Discover Health Loans for example are at 3.25% right now I believe. Check the most up to date information.

If you have poor credit--federal loans + parentPLUS (I think that's what they are called) is the way to go.

It's a joke that Uncle Sam wants 6.8%. Unbelievable.
Click to expand...

This is bad advise. Taking out private loans is a huge liability. You won't have IBR through residency like with federal loans or during the beginning of your career. Also, you will not qualify for many loan forgiveness plans on the private loans.

Finally, there is the issue of actually getting private loans!! It is very difficult, as a student, to convince a bank to loan you tens or even hundreds of thousands of dollars when you have no income and virtually no assets. Also, if you can't qualify for gradPlus loans you most likely won't qualify for private loans.
 
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