Lines of Credit.

[BMO guy]

I think if you read the fine print it says that the interest rate may be reassessed after you graduate. And I think it was true for at least one other bank I looked into (MDM?).

 

Basically, when I asked about it, the rep said the rate will depend on so many factors, that while it is highly likely it will remain at prime, there is no 100% guarantee...depends on your credit history on graduation along with various other ecomomic factors that I don`t care to understand.

 

I wouldn`t worry too much about the rate after you are done. If the market stays the way it is, another bank will be happy to take you on at prime, so you can just transfer your LOC.

 

Just and FYI, att BMO, our LOC rate stays at prime for the life of the loan. Although I believe all major Financial Institutions have similar terms to their professional student line of credits.

[BMO guy]

The best thing is to completely avoid getting an LOC at all. In the long run you're paying far more than they're lending you. So if you can avoid it, do so.

 

There are so many students who use the LOC like its free money, buying fancy cars, and fancy sound systems for those fancy cars. Then they gotta py it all back plus interest. Sure, they think they'll be making a lot of money, but there are two factors that they aren't thinking about:

 

1. If you go into family, peds, or psych, you're not going to be making a fortune, so you'll be in debt for a long time.

 

2. If you instead waited until you had liquid assets instead of using your LOC, you could buy a fancier car with a fancier sound system. Patience....

 

 

BUT, if you really need the LOC, never ever ever accept anything more than prime. If you do, you are a fool. Sure, you may cite bank loyalty as a factor, but that is a ridiculous reason. Just go for the thing that drains your pocket the least.

 

If you're really really good, press on them such that even if prime goes up in the future, your rate says at the one you took your LOC out on. Do this at various places, so that they have competition. Heck, even lie about it. These are banks. You don't need morals when dealing with them, just legalities.

 

Wow, thats a little harsh...we have feelings too (j/k). But with regards to the rate, most major banks all offer prime to med and dent students, and is termed at a variable rate so it will be floating relative to market conditions. I have not yet heard of any bank who will lock in a rate for a professional student line of credit:)

[BMO guy]

Hey BlackJack

Thanks for the great advice. Sadly, I think I will end up going into family medicine

 

Hi Hopeful, I think the CMA is working with the federal government right now for a special program geared specifically towards medical students going into family practise. I think this is mainly due to the fact that there are less and less students willing to become family doctors and they are trying to promote this field of medicine more. I believe there will be either free or really cheap money going towards students who is going into this stream of medicine to help repay their debts...I honestly do not know the specifics, but when i was talking to a few people in BCMA they told me something like this is in the works. Just an FYI, maybe you can look into it more.

 

Cheers!

[f.b.kal]

I think the CMA is working with the federal government right now for a special program geared specifically towards medical students going into family practise. I think this is mainly due to the fact that there are less and less students willing to become family doctors and they are trying to promote this field of medicine more. I believe there will be either free or really cheap money going towards students who is going into this stream of medicine to help repay their debts...

 

That sounds right; family physicians are in very high demand. In fact, there was a feature on the evening news discussing how some cities and towns in Ontario are giving family physicians huge bonuses to practice there for several years. The young doctor in the segment received $150K! In other places they simply pay off family physician's entire debt. That could be A LOT of loot.

[BlackJack]

That sounds right; family physicians are in very high demand. In fact, there was a feature on the evening news discussing how some cities and towns in Ontario are giving family physicians huge bonuses to practice there for several years. The young doctor in the segment received $150K! In other places they simply pay off family physician's entire debt. That could be A LOT of loot.

 

 

This sounds like a lot of money, but in the long run its pittance, and does nothing to increase the dismal number of students matching to FM. Think about it:

 

You go into family medicine residency and graduate as a CCFP with a debt of 150000. You get 150000 to practice in the sticks for five years. Now you have no debt, and you will make approximately 70-100000 a year of take home pay, depending on how hard you work and how much business you do. That's 500,000 after two years of residency and five years of practice. Not bad...

 

Now, you go into ..lets say...ophtho(I'm picking something high paying; you could have supplanted anything like derm or plastics in there). You graduate with 150,000 in debt. Upon getting your FRCS, you are making approximately 250,000 take home pay per year(not counting private procedures) while living in a large center, and possibly more if you're living in the sticks. Five years later, after paying off your debts, you have approximately 1,000,000 total.

 

Huge difference.

 

The point is that the offers to pay doctors a signing bonus to practice in rural communities only works if the doctors are interested in doing family medicine in the first place. It does not do much to sway people interested in other specialties to the FM side since in the long run the signing bonus isn't really as substantial as it seems, and doesn't overtake the already large incomes of many of the competitive specialties.

 

I think they should eliminate the FM specialty altogether and go back to the old rotating internship year, where afterwards one can go into general practice for a while or specialize depending on his or her interests. That way people won't avoid FM like the plague(which they are currently doing) because of the well-known fact that once you match into FM you've basically hit a dead end when trying to switch up into anything competitive in the future should you desire to do so.

 

Or they could pay FPs the same salary as general surgeons. Every residency position would fill thrice over.

[NLengr]

I'm pretty much on the same page as you.

 

A major way to make FM more appealing to most grads is to lower the cost of medical school, while at the same time boosting the FM pay. Signing bonus to eliminate a large chunk of debt, while a boost in salary while practicing. For ALL family physicians. In the job market money talks, no matter how bad that sounds for the medical community.

[serpentine]

Hi everyone,

 

Some additional, minor differences-

 

RBC automatically insures your LOC unless you specify otherwise i.e. they own your LOC and charge a higher fee for insuring it than other insurance companies. This may be due to the Bank Act which prohibits bankers from discussing insurance whether they are qualified to do so or not.

 

MD Management offers free life insurance through the BCMA for the entire duration of your undergraduate degree. (MDM is able to discuss insurance provided you sign a release agreeing they have nothing to gain from doing so and that they have adequately informed you of other insurance options). You pay for the insurance when residency begins (if you decide to keep it). They have cheaper disability insurance (apparently, med students don't generally default on their loan payments and they don't seem to be dying). Even, if you go with another bank, say RBC, it seems to make sense to insure your LOC with MDM (i.e. BCMA).

 

Apparently, MD Management is a not for profit (they don't make a profit?). However, their alliance is with the National Bank of Canada i.e. they would not recommend another bank even if it were in your interest financially; also while their staff are not commissioned, they do work with financial incentives such as 'sales targets' which impact their salaries. Apparently, their staff is one of the better paid. Ironically, MDM is also opposed to your having the 150K upfront for other purposes (e.g. investing).

 

Also, curiously, MDM encourages you to open an RRSP, if you don't already have one and even if you can't make any contributions until residency (no penalty for no contribution, though). What do you think about this?

 

RBC and MDM seem to be head to head when it comes to LOCs. Other than the differences above, convenience seems to be the major difference. I haven't looked into Scotia's package too much. My understanding was that it was not as competitive but appeared as though they were - they were the major contributor to the new dental building on campus so UBC also helps some in promoting their package.

 

Does anyone have any additional useful info on insurance, life and disability?

 

Thanks,

Serpentine

[BMO guy]

Serpentine,

 

Actually banks are allowed to discuss creditor insurance with customers. This insurance is for the loan or credit facility where the bank either pays out the balance of the loan upon death or makes your payments for you if you are disabled. We are however NOT able to discuss life or disability insurance on its own. Therefore the premium we charge on line of credits is for the amount used on your line of credit and so only pays out the balance of the line of credit while actual life insurance will pay you a set amount ie. $1million if you pass away (knock on wood*) but the premium is set and likely to be more.

So if your your main liability is your student line of credit while in school and you have no loved ones that you need to take care of upon death, creditor insurance may be cheaper. Whereas people who are more mature and established in life who has a family, may opt for life insurance that pays out a set amount that covers anything.

 

Hope you give BMO a chance and look into our products and services as well when you are doing your research.

 

Cheers!

[kcolangelo2011]

I spoke with a few banks...eventually I went with MDM/National Bank...MDM is run by the CMA so they're not a bank, they just facilitate your LOC with National Bank and do other financial stuff like investing

 

Pro's that I've found:

*super helpful and way more knowledgeable than the other banks...at Scotia, Royal and CIBC even when I made appointments they still didn't seem to know all the details. National Bank called me and when I said my tuition was due ASAP they express posted everything to me (even included a paid express post envelope so I could send the signed papers back right away!)

 

*$100,000 life insurance and $18.67 in an RSP. Apparently 1867 was the year the CMA? (or maybe the BCMA) was founded

 

*No co-signor needed (which CIBC required)

 

*LOC acts just like a chequing account so you don't need to open another account

 

*free wire transfers...so I can transfer from my LOC to my other chequing accounts

 

Con's

Not very many bank branches or ATM's....but the transaction numbers are good (I can't remember if unlimited or not) but it seems like it would be hard to go over the limit for direct purchases

 

maybe others...i haven't found them so far

 

hope this helps someone!

[The_B]

Con's

Not very many bank branches or ATM's....but the transaction numbers are good (I can't remember if unlimited or not) but it seems like it would be hard to go over the limit for direct purchases

 

maybe others...i haven't found them so far

 

hope this helps someone!

 

I did a lot of research last year about this, and since National Bank is part of the "Exchange network"- http://www.the-exchange.ca/ - you actually have access to a lot of ATMs (apparently the second most in the country). You can use any of these as though it was one in Branch. Also, there are, to my knowledge, no limits for transactions, or at least I haven't encountered any yet.

[BMO guy]

I did a lot of research last year about this, and since National Bank is part of the "Exchange network"- http://www.the-exchange.ca/ - you actually have access to a lot of ATMs (apparently the second most in the country). You can use any of these as though it was one in Branch. Also, there are, to my knowledge, no limits for transactions, or at least I haven't encountered any yet.

¸

 

B: I`m pretty sure that there will be a service charge for using ATMs that are not affiliated with National Bank even though the ATM may be part of certain network. Most banks are with Cirrus, Maestro and Interac (as you can see on the back of your bankcard or credit card), and so you can use your bank card or credit card on any machine that has those symbols, but you will be charged a service fee by your bank as well as by the ATM. I believe the ATM network only indicates if your card is able to use the machine, but does not mean it will be a free transaction.

[The_B]

¸

 

B: I`m pretty sure that there will be a service charge for using ATMs that are not affiliated with National Bank even though the ATM may be part of certain network. Most banks are with Cirrus, Maestro and Interac (as you can see on the back of your bankcard or credit card), and so you can use your bank card or credit card on any machine that has those symbols, but you will be charged a service fee by your bank as well as by the ATM. I believe the ATM network only indicates if your card is able to use the machine, but does not mean it will be a free transaction.

 

Like I said, as long as it is a part of the exchange network, there is no fee. And I am pretty positive of this since I don't use the national bank ATM in my area. There is a credit union closer to my apartment which is part of the exchange network that I use regularly. From here I do deposits, withdrawals, and my other banking all without fees. I have used other ATMs in the exchange network as well, all with the same results.

 

I believe you are mistaken as to what the exchange network is. It is a collection of banks that have bound together to expand the number of ATMs available to their customers, since many of its members, such as National Bank, or credit unions, have few branches themselves. This means that I can do regular banking procedures (such as deposits) at any of them, not simply withdrawls, all without fees. It is still an interact vehicle, as I can make purchases and what not, like any other banking card.

[Ollie]

Like I said, as long as it is a part of the exchange network, there is no fee. And I am pretty positive of this since I don't use the national bank ATM in my area. There is a credit union closer to my apartment which is part of the exchange network that I use regularly. From here I do deposits, withdrawals, and my other banking all without fees. I have used other ATMs in the exchange network as well, all with the same results.

 

I believe you are mistaken as to what the exchange network is. It is a collection of banks that have bound together to expand the number of ATMs available to their customers, since many of its members, such as National Bank, or credit unions, have few branches themselves. This means that I can do regular banking procedures (such as deposits) at any of them, not simply withdrawls, all without fees. It is still an interact vehicle, as I can make purchases and what not, like any other banking card.

 

Just to echo this, yes you definitely can use your National Bank card at any Exchange ATM (which includes HSBC and most credit unions) for withdrawals and deposits with no fees! So you actually have access to many many ATMs!