Paying for Med School Apps

[ewing]

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I was wondering if people had any information about alternative loans one could take out to cover the costs of applying to med school. I've already borrowed up to the the full cost of attendance at my college, and I still need $3,000-$5,000 for fees, plane tickets, etc.

I understand that there are private loans that will let you borrow based on your own (and your co-signers') credit worthiness, but do any of these lending companies send the check directly to you? I'm afraid my school will reduce my other financial aid if they see I have another source of funds.

FYI, the loans I'm talking about are like P.L.A.T.O. loans from Wells Fargo (http://www.wellsfargo.com/per/student/loans/undergrad/plato/index.jhtml) or SunTrust's eMax loans (http://www.suntrusteducation.com/ploans-ei-em.asp).

Thanks.

 

[mpp]

Student loans are usually not meant to pay for things such as application fees and airfare/hotel costs. However, I don't think these lenders would be too strict about what the money is used for. I would discuss with the specific lender how the monies are disbursed and whether or not they send a check directly to you. I think that they might.

A credit card is another method to borrow money for application and interview expenses.

 

[ewing]

Ok, so I've been doing some research on this and I just wanted to share my results wiith y'all since I've seen people with similar problems (borrowing more than COA) on SDN.

Basically, they all offer variable rates which are a function of Prime, T-Bill, or LIBOR. Based on your (and your co-signer's) credit rating, they give you a rate the is a certain amount more than one of those benchmarks. The thing is, they're very cagey about telling you in advance what rate a given income and credit score would get--instead they want to take your info and "pre-approve" you to give you a rate. That is not very cool, since every time someone runs a check like that on you, it slightly lowers your score.

Wells Fargo (P.L.A.T.O.) said their rates range from Prime to Prime + 10% (currently 4%-14%). I think I'm gonig to try to do it with Bank One (http://www.educationone.com/index.htm) since they are very explicit about not requiring loan certification and about sending the check straight to you. (SunTrust actually says they will share any information you give them with your school, which could potentially turn around and reduce your other aid.) Also, the range of rates they offer seems to be smaller (roughly 6%-8.5% using the current LIBOR of 1.3%). There is also an orignation fee of 5% to 10.5%, depending on the loan type, repayment option, credit history and whether a cosigner is included.

I'm only doing this because my parents have maxed out their home equity line of credit, and because unlike credit cards (which could potentially offer a better rate, especially if you are using the card to buy stuff, not getting a cash advance) you can defer payment for 4 years during school, and then you have a 20-year payment plan. Also, it may be that interest is tax-deductible, although I'm not sure about that.

I hope this helps. It's certainly not the final word, since I'm basically just figuring this stuff out as I go along. I also don't get the feeling that this is a real bargain. Actually, it seems marginally acceptable assuming I'm at the mid-to-low end of the interest rate and origination fee spectrum. I'd love to hear any advice or experiences anyone else has with this issue.