LOCs

[Guest Spazumn]

The credit limit for the RBC LOC Visa is $5000, regardless of which type of card.

 

I spoke with my branch financial advisor about it, and she said despite the limit, some schools will allow automatic payment by credit card, we just have to give them the card # and expiration date. Not all schools allow payment by credit card however, so I am trying to find out whether UofT does - anyone know?

 

And no, I don't believe you can collect points from balance transfers or cash advances.

[Guest Steve U of T]

I see. With all this talk of people putting their tuition on their credit card, I thought perhaps people were planning to put their entire tuition bill on their credit card, which would require a $15,000 limit or higher (which seems highly unlikely). I opted out of the credit card that comes with the Scotiabank LOC because those have a maximum $5000 limit, and I already had a card with a higher limit.

 

As an undergrad at U of T, I don't recall ever seeing an option to pay my tuition by credit card, then again, I never had an intention to do that, so I didn't look very hard. I'll definitely look into putting some of my tuition on my credit card at Western, I have a moneyback reward program on my card.

[Guest nextstopmd]

Hey Steve,

 

As far as I know, you could always make your tuition payment via credit card in more than one step (ie 5000 at a time, pay the bill, repeat). That should get you around the credit limit...

 

nextstopmd

[Guest vitegeist]

I think you can also overpay on your credit card, so that effectively, you have a greater limit. Say your limit is $5000 but you need $7000. Just pay an extra $2000 as if you were paying your credit card bill, and you'll be set. This is according to the RBC Med/Dent special banker dude for UBC.

[Guest Spazumn]

Well I just heard back from the Financial services department at UofT today, and unfortunately I cannot pay my fees with a credit card. My account manager at RBC also told me that certain schools accept payments via credit card (i.e. Concordia, UofA, UBC and some others) but she knew that some (McGill and apparently UofT) do not.

 

I had been planning to make a couple of overpayments as vitegeist suggested, to pay my tuition and get avion points with a VISA Platinum preferred card, but now I'll stick with the no-fees Platinum card and pay my tuition as requested by UofT, at the bank.

 

Flightless Spaz :b

[Guest purplefairy13]

I just had an appointment with RBC...evidently your interest rate remains at prime until 12 months after residency, and then it increases to prime + 3.5% (or more). I tried to negotiate that the interest rate remains locked at prime until the loan is completely repaid, but that's evidently "against policy" (stupid fine print). Has anyone successfully gotten such an agreement in writing? If so, where? Thanks.

 

PF13

[Guest uteng]

Your credit line is re-assessed 12 months after residency for repayment terms, but as long as you have a good history of paying your debts on time (e.g. previous student loans, credit cards etc..) you should still be at prime.

 

Since you're in Toronto, you probably want to talk to the University & Dundas branch where they have dedicated people for the healthcare field. The guy I worked with is kevin.fernandes@rbc.com. In his email he said,

 

>The RBC professional student line of credit is at

>Prime for the entire period while you are in

>school, residency and while in repayment as well.

 

I don't have my documents with me at the moment, but I'm not too concerned. Keep in mind that you're not locked into your LOC. I found out that there's no penalty for closing the RBC line of credit. I'm sure another bank would be happy to absorb my huge line of credit from RBC if I want to move, and have me pay them the interest instead of RBC. At National Bank, if you leave before six months though, there's like a $250 charge or something, but six months is not that much in the grand scheme of things.

 

Hope that helps,

uteng

[Guest purplefairy13]

Thanks,

I'll contact him on Monday.

 

PF13

[Guest Steve U of T]

You might want to try Tuesday, I don't think banks will be open on Monday.

[Guest Steve U of T]

By the way, if anybody was wondering about mortgages, I just signed the papers for one yesterday. The best interest rate I could have got was on a 5-year term, variable rate of prime - 0.75% (i.e. 3.5% now). Since interest rates are expected to rise over the next few months, I decided to go with a fixed rate mortgage, and the best rate I could get for that was at the current prime rate.

[Guest premed777]

steve, just wondering out of curiosity, did you have to have a co-signer for hte mortgage?

[Guest Steve U of T]

No, I didn't require a cosigner. The monthly mortgage payments are affordable within the budget of my LOC, and the bank was okay with that.

[Guest cryo]

hey

which bank is this with??

thnx

[Guest Steve MD09]

(I changed my account name, but I'm the same person as above)

 

I'm with Scotiabank.

[Guest AC]

Does anybody know if RBC or MDM have monthly service charges with their LOC?

 

I just talked to Scotia, adn they charge something like $3 per month.

[Guest Steve MD09]

RBC has no monthly fee, although their website suggests you only get this while you're a student. I think National Bank has a no-charge option with limited services, and an account with a monthly fee that includes more services (probably a special credit card too).

[Guest AC]

Thanks Steve.

[Guest satsumargirl]

Are you refering to a service charge for the LOC or for a chequing account with the same institution?

 

I don't know of any bank that charges a service fee for having a LOC....they're making money on the interest.

 

I just met with MDM to discuss LOC and bank accounts. There is no service fee for the LOC. You can set up a chequing account with them if you want. There is no fee for this account. In the brochure it lists a small fee, however, as of last week it was waived, so the chequing account in now 100% free with unlimited transactions. The only downside I could see with National bank (who MDM refers you to) is that depending on where you are there may not be alot of branches. They are on this Exchange system though so that you can withdraw and deposit funds at no fee at other banks ATMs if they are also on the Exchange. I looked up ATMs in Ottawa that are part of this agreement and there were about 40 places that came up and one's even on the main Ottawa campus. And they will give you free postage paid envelopes if you want to send in deposits (if that is what you prefer) or if the ATMs aren't convenient for you. Of course you can phone or internet bank for free. I rarely ever go into a branch so this arrangement works for me.

With my current bank (that I am looking to leave anyway) I have to keep a minimum $1000 to have the service fees waived and if it goes lower than as a student I would get 50% of the fees....but I easily have $20 in fees a month, so don't want to pay interest on my LOC to keep the minimum $1000 and also don't want to be paying $10/month in service charges. So I may go with the account at National bank since I will probably be going with then for my LOC. The staff at MDM seem pretty helpful.

 

If you keep your chequing account somewhere else but go with NAtional for your LOC, if yo want they will set up an automatic monthly deposit to your chequing account. I think this would be a great budgeting tool! Instead of having tens of thousands of dollars to tap into you only have say $1500/month and you can see it getting used up alot easier.

[Guest kapow44]

Does anyone know if all LOCs require a co-signer?

 

I have a perfect R1 credit history, considerable savings from several years of full time work and yet they still asked me for a co-signer (BMO). Unfortunatley I don't have anyone I can ask.

 

Are all the banks like this? Should I just take my business elsewhere?

[Guest UWOMED2005]

Neither RBC or NBC asked for a co-signer.

 

And I don't have a perfect credit history. . .

[Guest Steve MD09]

I wasn't asked for a co-signer at Scotia.

 

The fees at Scotiabank are for the banking services. Their professional students plan includes a small business chequing account, and the LOC is accessed by overdrawing that account. The monthly fee is for unlimited transactions, chequing, etc., not the LOC itself. Perhaps I'm being stubborn by staying with Scotiabank and paying the fees, but it's only $3/month, and there are a couple of branches very conveniently located near my condo.

[Guest UWOMED2005]

Any LOC is fine as long as you check 3 things:

 

a) Will they provide enough? They used to be on par with RB, BMO but those two and NBC have increased their limits. And of course you don't necessarily need $150,000 dependent on your financial situation. . .

 

Is their line of credit PRIME - and by that I mean BANK OF CANADA PRIME. There's sometimes a difference - some Banks have their own "prime" which is in fact Bank of Canada Prime + 1. Make sure you're getting THE prime lending rate - 4.25%

 

Scotiabank has been good for this in the past.

 

A couple of years ago BMO was offering "prime -1". . . which turned out to be "Bank of Canada prime +1 (for BMO prime), -1". . . to make it equivalent to the other bank's prime.

 

The current prime lending rate is 4.25%, as of Aug 11 2005.

 

c) THIS ONE IS KEY AND OFTEN FORGOTTEN - What will your rate be on paying back?? A couple of my classmates found themselves burned with BMO to find out their payback would prime + 2%.

 

d) do you need life insurance? It will cost as you borrow more

 

You're right. . . save a few bucks on monthly banking fees isn't worth it if the LOC isn't right for you.

[Guest Steve MD09]

The current prime lending rate is 4.25%, as of Aug 11 2005.

Sadly this won't be the case for long. It's expected to rise 0.25% on September 7th, and again in December. I got a fixed rate mortgage to protect myself from this, although I'd much rather have a fixed rate LOC and variable rate mortgage. Too bad all these LOCs have a variable rate.

[Guest 0T6]

On the life insurance note.. I just found out from the OMA website that if you're a medstudent-member, you get FREE life insurance for $100,000. RBC didn't require me to be insured when I signed up for my LOC and but I was thinking about it so this is great, especially if you don't plan on (but who knows) maxing out your LOC.

 

www.oma.org/ins/life_ins_medstu.htm

[Guest uteng]

satsumargirl wrote

"The only downside I could see with National bank (who MDM refers you to) is that depending on where you are there may not be alot of branches."

 

This ended up being my reason for going with RBC (more branches in my area). For security or some other reason, banks can only automatically transfer funds between accounts within the same bank. If i wanted to use another bank's ATM that's close to my place, I would need to make a manual deposit ("write a cheque to myself" to this new branch) before withdrawing funds.

 

A minor hassle really, but I didn't want to do it all the time. Is that the way you understand it too satsumargirl?

You can't automatically transfer funds from NB to another bank by Internet or telephone banking as far as I understand.