Line of Credit Options NEW INFO

[rmorelan]

ya,it really does seem diff representatives from the same bank are saying diff things.that definately worries me.can someone else please confirm that this is in infact true and they have actually heard this from the representative's mouth.

 

this is really common - the problem is that there most bank reps never see a med student for a line of credit (really there so few of us compared to everything else they deal with). Better to go to a rep I think in the city where the school is located - at least that would be a dedicated one how deals with them on a regular basis. and of course learn what is possible from the forum so you don't get ripped off

[UTPEOPLE]

Okay, I am now approved at RBC for 200k. I get 150k up-front, and an extra 50k going into my fourth year!

 

wow! how did you manage that? you didnt have to bribe the people ( or get a cosigner), did ya?

 

also... could everyone summarize the extra perks that people have been able to get? like the waiving of annual fee credit cards, sign-on bonuses and the like...

[chuck62]

They gave me a platinum travel visa (1.5% back) which has an annual fee of $89. Scotiabank, according to the package they gave us during OWeek, gives you a Gold Visa (ScotiaGold Passport, 1% back) which has an annual fee of $110.

 

I had to go twice to get the fee waived. It is possible.

 

so wait, which bank waived the fee for you? I am going to get my loc through scotiabank.

[Dr Crusher]

They gave me a platinum travel visa (1.5% back) which has an annual fee of $89. Scotiabank, according to the package they gave us during OWeek, gives you a Gold Visa (ScotiaGold Passport, 1% back) which has an annual fee of $110.

 

I had to go twice to get the fee waived. It is possible.

 

I am also looking for clarification on this... I think the ScotiaGold Passport is the one I want but I don't want to pay the fee. Were you successful in geting it waived at Scotiabank?

 

So glad I found this thread... I am sorta clueless about financial planning! Thanks in advance!

[chuck62]

I am also looking for clarification on this... I think the ScotiaGold Passport is the one I want but I don't want to pay the fee. Were you successful in geting it waived at Scotiabank?

 

So glad I found this thread... I am sorta clueless about financial planning! Thanks in advance!

 

hey,

 

I was able to get the Scotiabank Momentum Visa(with the 39$ annual fee waived). I didn't ask about the passport one because i found the momentum more appealing.

[dr_horrible]

I went to Scoitabank yesterday to fill out the final paperwork for my LOC, and I got the 1% cash back Visa, with no yearly fee. I was told that this (having no fee) was the norm for this particular card.

 

A question though: since I didn't have any concrete "proof of enrolment" to take with me (only my offer letter), I can't get access to my LOC until August when Scotia does a proof of enrolment check. Is there any way to get proof of enrolment sooner. I want a car, need to pay for some of it on my LOC, and I am impatient!

[UTPEOPLE]

just found a great credit card! Its the MBNA smart cash platinium plus... No annual fee... 1% cash back on everything else, 3% cash back on groceries(!)... I think there is a miniumum income requirement... (but maybe you med students could get the requirment waived?)

[Dufferindas]

I went to Scoitabank yesterday to fill out the final paperwork for my LOC, and I got the 1% cash back Visa, with no yearly fee. I was told that this (having no fee) was the norm for this particular card.

 

A question though: since I didn't have any concrete "proof of enrolment" to take with me (only my offer letter), I can't get access to my LOC until August when Scotia does a proof of enrolment check. Is there any way to get proof of enrolment sooner. I want a car, need to pay for some of it on my LOC, and I am impatient!

 

Ask the school you were accepted for a letter confirming your enrollment... that's what I did, and can now access my line of credit, so it seems to have sufficed.

[AdamP]

just found a great credit card! Its the MBNA smart cash platinium plus... No annual fee... 1% cash back on everything else, 3% cash back on groceries(!)... I think there is a miniumum income requirement... (but maybe you med students could get the requirment waived?)

 

I would think about that, I had an MBNA card (they are an american bank) and they harrased me like weekly with calls to add insurance etc.

 

It got so bad I had to cancel them (that was a huge hassle too), my BMO mastercard is also no fee cash back I think 1/1.5 for gas, and they have never bugged me once.

 

Edit: also who's excited prime just went up a quarter point today

[raptorsfan]

For people getting your LOC from Scotiabank, do you have to start the repayment with the start of residency (end of 4 year med program) OR following residency?

 

My RBC rep says the RBC LOC allows you to start repaying at the end of residency, though the interest here accumulates monthly.

 

Scotia wants me to start repaying at the start of residency. However, they have their interest capitalizing annually.

 

Any thoughts/ comments from your reps?

 

Cheers!

[BigM]

For people getting your LOC from Scotiabank, do you have to start the repayment with the start of residency (end of 4 year med program) OR following residency?

 

My RBC rep says the RBC LOC allows you to start repaying at the end of residency, though the interest here accumulates monthly.

 

Scotia wants me to start repaying at the start of residency. However, they have their interest capitalizing annually.

 

Any thoughts/ comments from your reps?

 

Cheers!

 

I imagine what you were told by Scotia is incorrect. From what I have seen, almost all banks give you a year after you finish residency before you need to start paying back your LoC. One thing to note though is your LoC may turn into a loan at this point (higher interest rate).

 

And AdamP, you basically ruined my morning by showing me that prime has increased already

[BigM]

I went to Scoitabank yesterday to fill out the final paperwork for my LOC, and I got the 1% cash back Visa, with no yearly fee. I was told that this (having no fee) was the norm for this particular card.

 

A question though: since I didn't have any concrete "proof of enrolment" to take with me (only my offer letter), I can't get access to my LOC until August when Scotia does a proof of enrolment check. Is there any way to get proof of enrolment sooner. I want a car, need to pay for some of it on my LOC, and I am impatient!

 

Hey dr_horrible,

 

Try e-mailing admissions and asking for a non-conditional letter of acceptance. I was told today that I have been approved for MD Financial, but only on the condition that I provide them with a non-conditional acceptance letter. I was also told that students routinely ask for these and they are easy for the admissions office to create.

 

If that isn't sufficient you can try adding in your e-mail from Schulich saying that you accepted the offer and the e-mail saying that your deposit has been received and welcoming you to the 2014 class.

[UTPEOPLE]

No bribery, no co-signer. Just persistence.

 

wow... 200k.. maybe by next year the LOC will be 250K

[RandomGuy]

I went to TD today (my usual bank) to talk about LoC options. They are now also offering a $200,000 limit as standard, with the usual prime until after residency, etc. They also offer a cash back Visa or a travel Visa that actually looks rather interesting.

 

This (above) seems to be the standard offering from most banks these days. I am going to go visit a couple of other banks in the next week or two and see what they're offering. The lady at TD advised me that I could come back with anything interesting that I was offered at other banks and we would discuss if it was possible through TD. She did say that LoCs these days are rather "apples to apples" - banks are offering very similar things, so you should go with the bank you feel most comfortable with.

 

Basically my question is - what should I be pushing for above and beyond the standard offering ($200,000 @ prime + decent credit card)? I have no trouble bargaining, but to be honest I can't really think of anything else I really need.

[dr_horrible]

Thanks guys! I e-mailed the amissions office, and they sent me a letter that basically confirms that I am enrolled.

 

Hey dr_horrible,

 

Try e-mailing admissions and asking for a non-conditional letter of acceptance. I was told today that I have been approved for MD Financial, but only on the condition that I provide them with a non-conditional acceptance letter. I was also told that students routinely ask for these and they are easy for the admissions office to create.

 

If that isn't sufficient you can try adding in your e-mail from Schulich saying that you accepted the offer and the e-mail saying that your deposit has been received and welcoming you to the 2014 class.

 

Yes, call Western. They will email you a letter confirming that you have accepted their offer.

[BigM]

Glad to help. But just as an additional note, make sure you read up on the effect that owning a vechile can have on OSAP & bursaries if you haven't had a chance to yet.

[dr_horrible]

I'm going to put the vehicle under my parent's name, with me as an occassional driver, if the value of the car I buy surpasses what is allowed (I think even for OSAP you can own a car with a certain value without it hurting the amount you get, but I will double check!)

 

Glad to help. But just as an additional note, make sure you read up on the effect that owning a vechile can have on OSAP & bursaries if you haven't had a chance to yet.

[BigM]

I'm going to put the vehicle under my parent's name, with me as an occassional driver, if the value of the car I buy surpasses what is allowed (I think even for OSAP you can own a car with a certain value without it hurting the amount you get, but I will double check!)

 

If the vehicle is under your parents name you will not be required to claim any of it on your OSAP. However, you will likely need to be the primary driver as opposed to an occasional.

[rmorelan]

The most obvious thing to negotiate would be the yearly caps. See how much you can get up-front.

 

Seems like a lot of people are focusing on the yearly caps - I am curious a bit about that as I honestly don't know why it is a big deal for so many (but obviously it is as so many people are concerned). Can someone shed some light on that for me?

 

My logic when I took the loan was OSAP + even about 1/2 of the typical limit was more than enough and unused parts would roll over to the next year anyway.

[polarb]

luckythirteen, are you going to get OSAP as well?

 

What is OSAP's view on owning a car? I would really like one for med school but if prevents me from getting OSAP, I will just have to suck it up.

[rmorelan]

That's surprising that you can even afford to buy a car on that. I just did a very comprehensive budget, and my expenses (*excluding* rent, utilities, cable, home phone, internet, and interest payments on my LOC) will be at least $34,000. And that doesn't include buying a car (but does include car insurance, gas, etc.)

 

Maybe not a new car? - osap is 16000 and loc is at least 35000 - that is over 50,000 dollars. Easy enough to lease a car or buy a very good used on on that.

 

I mean I would expect a student to have some problems flat out buying a nice new car walking into 4 years of school I wouldn't want to carry the interest payments on that over 4 years if I didn't have to.

 

Plus haivng too nice a car really screws you over for OSAP and you really, really want to max that if you can - I mean you get to pay less than 1/2 of it back with no interest for years. When they do charge you interest (way above prime by the way) you flip the loan to your loc for the lower interest. OSAP will cut the 4 year cost of your education by about 35,000 dollars if you max it out and having max osap is a key indicator for bursaries/work study at most schools for even more money.

[BigM]

luckythirteen, are you going to get OSAP as well?

 

What is OSAP's view on owning a car? I would really like one for med school but if prevents me from getting OSAP, I will just have to suck it up.

 

Normal students can have a vehicle worth up to $5,000 without it becoming an asset on OSAP. Any value above $5,000 will be used against you but given the expense of med school it probably won't make it disappear altogether. Also, as a medical student it is possible to get a note from your school saying that a vehicle is necessary for your program. This will allow you to have a vehicle worth up to $10,000 before it becomes an asset. However, I do not know how easy it is to get this note before clerkship.

[rmorelan]

So, if that 35k would cover only living expenses (minus rent), you would probably need $10,000 of the OSAP for rent/home phone/cable/internet and thus have $6000 to cover interest payments AND buy a car?

Anyway, I wouldn't buy a brand new car, but a used car, and pay cash.

 

Western estimates the total cost of education for year one to be 37,500 dollars (rent, tutition, books, food, equipment....everything ) That includes a pretty nice apartment as well and being very generous with expenses. My total costs were actually quite a bit less than that.

[rmorelan]

Yes, I went with MD Financial for budgeting too. That's why I'm super confused with what you're saying.

 

That's what every single bank person told me, some ruder than others, (essentially, that they want to cap my LOC because they assume I am irresponsible with my money and will go out and buy a BMW). I found it pretty insulting to be told I can't manage my money, despite my excellent credit history.

 

the real reason from the banks point of view i think is that really they don't make any money on the lines of credit. The fees are at prime which is 2ish percent which is basically the rate of inflation. That means no matter how much money you borrow they really make nothing from you. Our classmate who used to be an investment banker when over all of this with us (got to love med school - such a diverse student population )

 

The reason they do all these LOCs is so later in life when you buy a big mortgage, business loan, banking for your business etc you will stick with them and make them thousands upon thousands of dollars.

 

Since you don't make them anything now (actually you really cost them money) they don't want to tie up assets until they have to with you (they can use the money they give you to make actual profit elsewhere). So the limit the amount you get for their own interests. of course to a small degree there is also the risk of you dropping out etc (happens to maybe one or two people at most a year) so that is an additional small reason to restrict things.

[HBP]

I doubt most people have a cell phone + home phone.

 

Also, many will choose internet > cable.