starting residency and financial constraints

[rkaz]

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So I'm moving cross-country for residency in about 2 weeks, and am wondering if there are any financial resources available with moving expenses. My biggest issue is that I don't have a car, as the car I've been using through med school is my parents' leased car. I've never bought a used car before so I don't know how I'd go about ensuring that a used car is legit or not (as I wouldn't want to buy a lemon). I don't even have the money to buy a used car, unless I can pay in installments, as I'll already have some credit card debt just from moving to my new city cross-country. It'll cost me about $2,000 to move my things there using the cheapest moving service I can find, but I feel that this will still cost less (and save less time) than trying to re-buy all my stuff over again.

I know there are doctor's loans for residents. Can someone tell me if this would apply to me? Is there anything that could cover the down payment on a car (if I wanted to go down the leasing option)? I could look around for a place that has leasing specials, but I'd need help with the down payment. I don't know if I should try to get a loan from somewhere to pay for a used or leased (new) car. There are a few remaining days until my graduation, so I don't know if it's worth to go back to my school to see if I can still take out more loans before I graduate.

I realize I probably come of as lost and confused, but this cross-country move and start of residency will be a huge transition for me. In med school, I didn't worry too much about money as I had Stafford loans, and a huge scholarship, and my folks helped me with the remaining expenses. However, I want to be entirely independent from here on out. My parents have offered to lease me a car there, but I'd rather not go that route, as I don't want to take anything further from them - but make ends meet on my own. However, we won't get a residency paycheck until the end of July - so I still have to make things work for 2 more months, as well as find out how to pay for moving and car expenditures.

Any help on this issue would be greatly appreciated!

 

[Elisabeth Kate]

I can appreciate and sympathize with wanting to do everything on your own. However, I would take your parents up on the offer of a car until you have a couple of paychecks set aside to buy your own. You don't want to be in a new city with a new job having to walk everywhere or rely on public transportation (unless you're in a pedestrian metro area, like NYC or Boston or DC or something). You can return the car in August when you can buy your own (and pay in installments).

As for the question about loans, I believe there are loans you can take out to help with moving expenses, but I'm not too knowledgeable about them, sorry. You might want to ask your new residency coordinator or GME office as I'm sure they've fielded the same question from many incoming interns before you. Just my two cents.

 

[mvenus929]

I'm in a similar situation, in that I don't get paid until the end of July, but I also don't have to move quite as far, so I'm relying on my credit card to get me through. I would also take up your parent's offer, though, and start paying for the lease yourself when you get your paychecks.

Discover has some residency loans that you can check out, but you have to apply before graduation. Your financial aid office probably won't be able to help you, as regular student loans can't have any more taken out after like March 1.

 

[NotAProgDirector]

My institution has a zero interest loan program for residents. Its for small amounts (up to $1000 I think) but a really good deal -- they give you the cash, then take it back over 10 paychecks, no interest. You'll only qualify once you're actually hired, so you'd need to get to your first day. But can be used as a bridge to your first paycheck. No idea if this is common, or just another example of how awesome my institution is.

 

[link2swim06]

Most new credit cards have 0% for purchases and balance transfers. Assuming you have good credit, you might be able to open a new one, transfer the old credit debt to it, make your moving purchases also on it and then pay down all that credit card debt before the 0% goes away (generally in 12-14 months).

Apart from the balance transfer fee (generally 2-4%), you will encounter no fees or interest per se, assuming you pay it all off in the first year of residency.

Often banks/car dealerships will offer you with a loan if you are a new grad and have a employment contract. Also as the poster stated above, there are loans that are available as a resident (discover). Although a normal car loan probably will be a lower interest rate (because it is secured debt...aka they can repo the car if you don't pay). Also co-signing with your parents might get you a better interest rate too. I'd compare all those options.

 

[RangerBob]

My program also offers a 0% moving loan. In addition, you can take out a residency and relocation loan from Wells Fargo, Sallie Mae, and many other banks. From what I heard Sallie Mae is offering lower rates right now.

I would stay away from a 0% credit card unless you are absolutely sure you can pay it off within the timeframe--there's a lot of fine print with those offers and you can get charged quite a bit of interest if you haven't paid it off in full in time. But as the above poster says--if you can pay it off in time it can often save you a lot of money in interest. You just have to be careful.

 

[randomusername]

I'd take your parents up on the offer, get the lease in your name, and have them cover it until you start receiving a paycheck. If you still want to feel like it was entirely paid for by you, over time you can then reimburse them for whatever they paid towards it previously. It will be the least stressful (at least right now you have a little bit of time and help to find a vehicle, once residency starts and you're in a different region, you won't) and cheapest/lowest-risk route.

 

[BlondeDocteur]

Good advice. Have your parents help you w/ negotiating the used car market (mostly certified pre-owned cars offered through dealerships are just dandy). More importantly, there are $10,000 "residency & relocation loans" offered to 4th year medical students precisely for this purpose: to defray the costs of residency apps, interviews, and moving. I had to take one through Citi a few years back.

 

[rkaz]

Thanks guys.... your comments are super helpful. My bank account is with one of the banks that RangerBob mentioned, so I'll see if they have any options - and will also check with my residency program. I talked with my parents, and they'd be happy to put the down payment on the car lease as my 'graduation gift'. So this might work after all. 🙂