RBC Line of Credit

[rmorelan]

Side note - by the time anyone here gets to 4th year it would be unlikely everyone is not at 250K. The banks usually equalize within a relatively short order (the 250K thing is really new this year for RBC).

[TheBestMedicine]

If you plan on travelling, I think that RBC is a better deal...

 

With TD infinite you get 3 points/dollar, $20 000 = 60 000 pts, redeemable for $300.

 

With RBC infinite you get 1 points/dollar, $20 000 = 20 000 pts, redeemable for $400 worth of airfare. The $120 fee pays itself off after $6 000...

[sirnoodleton]

If you plan on travelling, I think that RBC is a better deal...

 

With TD infinite you get 3 points/dollar, $20 000 = 60 000 pts, redeemable for $300.

 

With RBC infinite you get 1 points/dollar, $20 000 = 20 000 pts, redeemable for $400 worth of airfare. The $120 fee pays itself off after $6 000...

 

Does anyone have any experience with MD financial services? Their credit cards look pretty good (automatic triple-extended warranties). They also have line of credit that is up to 200K, NO INTEREST PAYMENTS until one year after completion of residency. Of course, the interest builds up, but you don't need to actively pay it off until you're done. Thoughts?

Cheers

[holiday1001]

what do you mean 'no interest'? if it's just getting tacked onto the LOC itself and gets added to your balance anyways... then what's the difference?

[Dr.Henderson]

what do you mean 'no interest'? if it's just getting tacked onto the LOC itself and gets added to your balance anyways... then what's the difference?

 

There is none, its just a clever wording gimmick in their advertisement as far as I know.

[sirnoodleton]

There is a difference. It means you don't have to actively pay it off during your academic career. Whereas with RBC you have to pay the interest annually. Like actually PAY it. Not let it add on.

 

On a 100K LOC with RBC, you pay 3000$ a year of interest, so you pay 250$ a month in payments. Your 100K stays at 100K.

 

What this MD one is saying, is that you just let the 100K turn into 103K, and so on. So you don't have to actually make payments while in school. It doesn't save you money in the long run due to compound interest of course. But it might have its advantages.

 

Thoughts?

[The Ace of Spades]

There is a difference. It means you don't have to actively pay it off during your academic career. Whereas with RBC you have to pay the interest annually. Like actually PAY it. Not let it add on.

 

On a 100K LOC with RBC, you pay 3000$ a year of interest, so you pay 250$ a month in payments. Your 100K stays at 100K.

 

What this MD one is saying, is that you just let the 100K turn into 103K, and so on. So you don't have to actually make payments while in school. It doesn't save you money in the long run due to compound interest of course. But it might have its advantages.

 

Thoughts?

 

I'm using National Bank as well. Having the interested compounded hurts, but it's great if you have no outside funds. You can use any LOC to pay the interest, but with NB it's automated like you said.

 

The actual advantage is that your LOC is also your chequing account, so you draw directly from the LOC as needed. With some other banks, you have to transfer funds into a separate chequing account to make use of them. Since you will likely be taking out more than you are using, you will be paying additional interest.

 

The main disadvantage is the lack of NB branches in BC. I think there are only three in the entire province: Downtown Vancouver, Richmond, and Victoria. But I have gotten by without actually stepping foot in a branch yet! Everything is done by mail and it's kind of cooling hearing the French accents from the people in Quebec.

[eller]

There is a difference. It means you don't have to actively pay it off during your academic career. Whereas with RBC you have to pay the interest annually. Like actually PAY it. Not let it add on.

 

On a 100K LOC with RBC, you pay 3000$ a year of interest, so you pay 250$ a month in payments. Your 100K stays at 100K.

 

What this MD one is saying, is that you just let the 100K turn into 103K, and so on. So you don't have to actually make payments while in school. It doesn't save you money in the long run due to compound interest of course. But it might have its advantages.

 

Thoughts?

 

I could be wrong... but in order to pay that 3000$ at RBC, you'll end up withdrawing 3000$ from within the same LOC, and suddenly your total is 103K... this isn't any different than at MD management. Although MD management (and Scotia IIRC) automate this process it comes out to the exact same thing.

[holiday1001]

exactly. it's the same thing. even if you had money to pay the monthly interest, you'd be better off shovelling that all back into the LOC, to reduce the balance.

[Dr.Henderson]

exactly. it's the same thing. even if you had money to pay the monthly interest, you'd be better off shovelling that all back into the LOC, to reduce the balance.

 

Yeah, I was reading that response and failed to see any difference. I don't actively "PAY" the interest, I put money in my chequing acct as I need it, from the LOC, and the interest payments come out of there. Zero difference. In your example it all ends up at 103k regardless of what method you use. Having the interest automatically added to my LOC rather than automatically paid from my chequing acct was definitely not a decisive factor in choosing a bank for me, there are more important factors like flexibility in access to funds, repayment terms, and credit card perks .

[holiday1001]

for me it was 100% access to funds

 

btw henderson, did you get the visa gold? I was offered the Visa signature and it looks like it's better? (1 point for 1 dollar). actually, on that subject, it really does seem that my visa rewards card, at 1% cash back, is a better deal than the signature rewards from RBC...

[Dr.Henderson]

for me it was 100% access to funds

 

btw henderson, did you get the visa gold? I was offered the Visa signature and it looks like it's better? (1 point for 1 dollar). actually, on that subject, it really does seem that my visa rewards card, at 1% cash back, is a better deal than the signature rewards from RBC...

 

Same.

 

Yeah they gave me the gold, I got everything as advertised. In hindsight I should've pushed for the infinite avion but oh well. I'm still using my 1% cashback that I already had (2% on groceries/gas/some other junk).