jonquille

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Does anyone have any experience with MedCap? It's run by Wells Fargo and is the preferred lender of my med school.
 

KyGrlDr2B

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Oct 15, 2001
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I dont have any info for you. Instead, I wanted to say that just because something is the preferred lender doesn't mean you have to use it. My school gave a list of lenders and I didn't really like any of them. Instead, I opted for t.h.e. My FAO didn't care one bit even though she said she didnt have much experience with them. It may have added a tad more work on her part, but I ended up with zero fees. :D
 

kd

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Medcap/Wells Fargo was my school's preferred lender last year, but they now switched to THE. The reason they switched was that Wells Fargo capitalizes interest TWICE on student loans, unlike THE and most other lenders. So if you can avoid Wells Fargo, it would save you more money in the long run to switch to another lender. Here's the email that our FAO sent out to us about Wells Fargo:
It has come to my attention that Wells Fargo capitalizes interest on
your unsubsidized loans TWICE, and not "once at repayment" as listed in
their brochures.

An example:

You borrow $80,000 of unsubsidized money during your 4 year enrollment.
Based on today's interest rate, about $12,000 of interest accrues
while
you are in school.
Wells Fargo adds this interest to your principle after the 6 months
grace period following graduation.
Then during your Residency, interest will accrue on $92,000 instead of
$80,000. That interest (about $16,000) will then be added to the
$92,000
when you begin repayment.

In essence, you will accrue interest on interest.

We do not support this type of double capitalization and suggest that
you change your lender for next year. T.H.E. Federal Stafford Loans
offer 0 fees and once in repayment, returns money to you based on the
amount of profit this non-profit lender makes. Learn more at:
http://www.northstar.org. We endorse T.H.E. because of the non-profit
status, the 0 fees and the Bonus benefits that do not change from year
to year. Other lenders have borrower benefits too, but change them each
year.

Having more than one lender will help later if you want to
consolidate. If you have more than one lender, you can choose who will
consolidate your loans. You will be able to shop around for the best
repayment benefits on your loan portfolio.

If you decide to change your lender or have questions or concerns,
please contact us.