Plan on Medical School Acceptance in 3 Years - Credit Question for Grad PLUS

[Jeex]

Just pulled my credit report - plan on maybe 3 years before medical school acceptance. I'll be 30/31 then. Here's my history. I'm currently saving all my money to pay off loans and do some other things. Would you folks have any recommendations? Will I get a Grad PLUS loan? I was very uneducated/misguided when I was younger about loans and credit.

Debts:
1. $22,000 - Gov't Student Loans, late 60 days Feb 2011.
By May 2017, this account is scheduled to go into a positive status.
I plan on paying this off before Medical School.

2. Credit card, $3,500 limit, payment on time except 30 days in Jan 2011.
Note: "by Oct 2018, this account is scheduled to go to a positive status"
I use this card every day for budgeting purposes. I pay it off in full every month and plan on keeping it. Gets 2% cash back.

3. Credit card, owe $1,622, collections.
Account is schedule to continue on record till Jan 2019
I plan on paying this off in full today.

4. Collection to AT&T $343, paid, closed.

5. Apartment Complex Collection Account, $67 owed.
I plan on paying this off in full today.

6. Verizon Wireless: Account charged off. $52 written off. Account schedule to continue until Apr 2019
I plan on paying this off in full today.

7. Bank of America: $489. Account Charged off. $489 balance. Account is Scheduled to Continue on Record Until 2018.
I plan on paying this off in full today.

8. Student Loan 2008: Account Charged off. $13090 Chase, Account is Scheduled to Continue on Record Until 2017.
I haven't made a payment and won't be able to pay this off before I get accepted into medical school. Not sure what happens if I don't pay.

9. Student Loan 2008: Account Charged off. $12437 Chase, Account is Scheduled to Continue on Record Until 2017
I haven't made a payment and won't be able to pay this off before I get accepted into medical school. Not sure what happens if I don't pay.

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[Jeex]

Not sure if this is a loaded question or not, just wanted some guidance seeing as I have 3 years of work to do

 

[Snivellus]

What is your credit score

 

[Jeex]

616

 

[Snivellus]

I think you should be fine. You only can take out PLUS loans after taking out the max Stafford loan which is 40.5k per year. They don't check credit for that.
Also you don't know what will happen in the future so I don't think you should worry about this now.

 

[nontradjd]

Sorry this is kind of late. In order to qualify for a PLUS loan, you can't have any debts (over $2k) that are over 90 days late at the time they pull your report. In the 5 years prior to the report, you also can't have defaults, discharges of debts in bankruptcy, foreclosure, repossession, tax lien, wage garnishment, or a write-off of federal student aid debt.

Your actual credit score doesn't matter for PLUS loans. However, it looks like you may not qualify based on what you posted. If this is the case, you must find an endorser that has the proper credit history necessary to qualify.

 

[michiganpsych08]

I actually think you will qualify. 3 years from now would be 2018 and it appears everything you posted will no longer be reporting by then or you will have paid it off so it doesnt matter. The only one is your credit card you use everyday and you pay it off in full every month so no problem there. The only iffy ones are the student loans but they actually wont be on your report come summer 2018 which is when they usually pull your credit. OP I think you will be fine, just don't rack up any more debt and be late on any payments in the months preceding school starting.

 

[Jeex]

I actually think you will qualify. 3 years from now would be 2018 and it appears everything you posted will no longer be reporting by then or you will have paid it off so it doesnt matter. The only one is your credit card you use everyday and you pay it off in full every month so no problem there. The only iffy ones are the student loans but they actually wont be on your report come summer 2018 which is when they usually pull your credit. OP I think you will be fine, just don't rack up any more debt and be late on any payments in the months preceding school starting.

Yep ty.

 

[deleted480308]

I think you are likely fine....i think you might even get away without a cosigner as your score will increase in the next few years

what you absolutely cannot afford is any more lates/collections/defaults....keep that junk current

 

[Mad Jack]

As long as all of your debts are currently being paid, even if they are in collections, you can get a grad plus loan.be aware, however, that Republicans and Democrats alike are looking to change the way student loans are handed out, so what applies today might not apply tomorrow.

 

[DrMidlife]

Paying off a federal student loan, instead of putting money toward getting current on other debts, makes no sense. There's no downside to carrying federal student loans into med school, from a credit worthiness perspective. You'll need to confirm that you're still eligible for in-school deferment, which is standard with federal student loans.

Credit score currently plays no role in federal student loan decisions. As others have said, you need to pay close attention to the GradPlus rules, which are about the state of individual debts. Specifically, "no current delinquencies of 90+ days" is going to be the problem. Your record is full of delinquencies way older than 90 days.

The doozie here is that you defaulted on $25k in private student loans, and Chase is one of those huge banks that can do whatever it wants. Wherever you're seeing "scheduled to continue on record until 2017", I'd put little faith in that happening predictably, or in a way that helps you get GradPlus. I don't see anything here about bankruptcy protection, so "won't continue" is tenuous.

In your shoes I'd contact Chase to start paying on those "charged off" loans right away. Get out of delinquency. And when the time comes, I wouldn't apply to med school until you have it in writing from the dept of Ed that you're eligible to borrow the cost of attendance. You don't just have a money problem. If you start school without a clear resolution and the loans don't come in, then you'll have a gap in your training, you'll have bad faith with your med school, you'll have to find a job in a big fat hurry, all your classmates will want to know what happened, etc.

Meanwhile, start sending campaign contributions to Elizabeth Warren. She's by far the strongest opponent of malfeasance in the lending industry and the ease with which Chase et al can ruin lives.

Now, I'm trying to be helpful here, but I've been very bothered by this thread since it started. You got yourself in a whole lot of debt, but you don't seem to see the ethical problem in defaulting. Yes, the US lending atmosphere is predatory and yes, there are a whole lot of people in the same shoes as you, but you signed for those loans. You bear responsibility for those debts. If the guvmint lends you six figures for med school with your history, you'll be getting away with murder.

Best of luck to you.

 

[michiganpsych08]

Paying off a federal student loan, instead of putting money toward getting current on other debts, makes no sense. There's no downside to carrying federal student loans into med school, from a credit worthiness perspective. You'll need to confirm that you're still eligible for in-school deferment, which is standard with federal student loans.

Credit score currently plays no role in federal student loan decisions. As others have said, you need to pay close attention to the GradPlus rules, which are about the state of individual debts. Specifically, "no current delinquencies of 90+ days" is going to be the problem. Your record is full of delinquencies way older than 90 days.

The doozie here is that you defaulted on $25k in private student loans, and Chase is one of those huge banks that can do whatever it wants. Wherever you're seeing "scheduled to continue on record until 2017", I'd put little faith in that happening predictably, or in a way that helps you get GradPlus. I don't see anything here about bankruptcy protection, so "won't continue" is tenuous.

In your shoes I'd contact Chase to start paying on those "charged off" loans right away. Get out of delinquency. And when the time comes, I wouldn't apply to med school until you have it in writing from the dept of Ed that you're eligible to borrow the cost of attendance. You don't just have a money problem. If you start school without a clear resolution and the loans don't come in, then you'll have a gap in your training, you'll have bad faith with your med school, you'll have to find a job in a big fat hurry, all your classmates will want to know what happened, etc.

Meanwhile, start sending campaign contributions to Elizabeth Warren. She's by far the strongest opponent of malfeasance in the lending industry and the ease with which Chase et al can ruin lives.

Now, I'm trying to be helpful here, but I've been very bothered by this thread since it started. You got yourself in a whole lot of debt, but you don't seem to see the ethical problem in defaulting. Yes, the US lending atmosphere is predatory and yes, there are a whole lot of people in the same shoes as you, but you signed for those loans. You bear responsibility for those debts. If the guvmint lends you six figures for med school with your history, you'll be getting away with murder.

Best of luck to you.

this is all types of wrong sorry. You can have delinquencies as long as you are paying on them or have now paid them in full. The OP stated he is paying them off or they will be paid off by the time he would be accepted into medical school. Like the previous poster said as long as you are paying on your debt and you are current with paying them, you will be able to be approved for grad plus.

Also Chase can not just do whatever it wants. Where it says it will continue to record until 2017 is a fact. Negative information can only stay on your credit report for 7 years and some change since the day it first went delinquent and you never recovered. Now, the only thing that can affect this is if the OP makes random payments here and there effectively resetting the time clock over and over. There is also statue of limitations on how long a creditor can collect on a debt. Depending on where the OP lives, this could very well be up and now they can't sue him for the past debt and now he can just wait out until it falls off of his credit report or be noble and pay it although he is no longer legally obligated to play it. (I understand you being helpful about the OP being in debt and such, but you also don't know his story and what happened to cause him to be in debt and be late and default on his loans. He could have gotten sick, lost his job, whatever so its not our place to judge)

Finally, grad plus only examines the last 2 years of your credit profile from the date that they run your credit for the majority of the debt so at the end of the day all of this is a irrelevant because the information that grad plus would use to make the determination as to whether he is approved or not doesn't even exist yet. Even yet and still, he can have up to $2085 in debt and still be approved. So again OP, as long as you don't incur anymore debt or late payments you should be approved for grad plus.

Reference: https://studentloans.gov/myDirectLoan/whatYouNeed.action?page=credit