Lines of Credit for Medical Students (Scotia is the best option)

[Liz30]

What I'm finding so far with my shopping around is that it's important to deal with someone who sees you as an investment and wants to retain a relationship with you long term so that when you start making money you think of them first for investment needs. Still shopping around but I know I won't be using my current bank TD. Not only did they not bother returning my call to the local branch, their info line people just read some random info off the website. Good times.

[adhocdds]

Both TD and BMO completely underwhelmed me when I booked consultations with them for LOC application.

 

I HAD accounts with TD, but will be switching to my LOC bank for my banking needs.

[MD2015]

RBC is pretty good. I switched to RBC after a couple of years.

[oshaku]

Just met with RBC today.  They've certainly got their stuff together and the advisor was prepared.  At this point, it's definitely between Scotia and RBC.  

Not liking RBC's $125 annual fee.. can't anybody get that waived?

[RichardHammond]

I met with RBC too but don't recall a $125 fee. Are you talking about the Platinum Avion credit card fee?

[Username92]

Oshaku, did you meet them in Mtl? I'm planning to go see an RBC advisor soon. What did they tell you about the "registration proof" needed?

[oshaku]

I met RBC at the Peel & Sherbrooke branch in montreal.  For now, the proof of registration can be your letter offering admission and proof that you paid the deposit.  You can also go on Minerva at the meeting and verify your status. (Fact that they know what Minerva is goes to show how frequently they deal with McGill students.)

 

RBC offered me the VIP banking package which has the $125 annual fee and you get the avion card fee waived.  But the avion fee is pretty much equivalent so I don't feel like any of the fees have actually been waived.  The free cheques and interac e-transfers are nice, and the fact that RBC can process Quebec student loans is a big plus.  Scotia has no fees, but they don't process Quebec student loans, which is a major drawback for me and will require that I have a bank account at another bank.

 

In terms of rewards, I think the point rewards conversion is slightly better with the Avion than the ScotiaGold Passport (max ticket for flights are an over-estimation but it amounts to ~2% with the avion while Scotia's is just 1% overall) , but the Avion doesn't provide medical insurance for travel.  Scotia provides a discount car rental, something I'm more likely to use.  Has anybody used the Scotia rewards travel site?  Does it provide good deals?

 

Overall, if it weren't for the situation with QC student loans, I'd probably go with Scotia.  

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[mmd7]

Pretty sure with Scotia you get the line of credit at prime like every other bank, plus a free ScotiaOne account (usual chequing kind of account) with unlimited free transactions with the card (I get that now already as a student with them), plus you can sign up for the ScotiaGold Passport Visa and the Scotia Gold AmEx card - both of which have sweet travel rewards especially the amex because it's 4x the points. And both cards have their fees waived. If this is truly the deal (meeting with my advisor today) I'll edit this post and let you guys know but that sounds like an awesome deal to me. I would love to spend every dollar on travel rewards cards, pay them off with the LoC and get some free flights and hotels!

 

Edit: After talking to my advisor at Scotia it sounds pretty similar to RBC's plan people have talked about here - She said that the funds are not released until proof of enrollment (but the line of credit can get approved with just the letter of offer). They tend to approve without a cosignor unless you have bad credit.  It's 200 K at prime - only 50 K allowed per year but in years 2, 3, 4 they are flexible on how much you can use, if you find you need a little extra one year you can use it but then you get less for other years- AKA the whole 200K is not freely accessible from the get go. And then once you get to residency they can extend if you need more money (she didn't say how much but I'd assume up to 275 K or so). She said you get the ScotiaGold passport visa with all fees waived with a 5K limit, but if you want the AmEx card you can get that instead but you have to pay the fees for it (and it's still only 5K). If you have another credit card through somewhere else, they subtract that credit from the credit they'll give you. So, I have the Chase Amazon Visa right now with 1K limit, so they'd only give me a 4K credit card if I don't consolidate which is kinda dumb (I bet I could negotiate them on that cause it's sort of ridiculous).

 

To be honest, although I do mostly trust myself, I personally don't mind the limits set out on how much I can use per year because I think it's easier to budget if you're like "Ok I can't spend more than 50 K this year" as opposed to "WOO HOO I HAVE 200 K AT MY DISPOSAL!" but I'm also quite young (23) and not married and all of that so I might be more tempted than others to blow money because it's available. Which I'm gonna try my hardest NOT to do!

 

Edit edit: Advisor just emailed me and apparently it was recently changed so that you CAN get the AmEx card with fees waived.

[RBC-HealthcareSpecialist]

You can get RBC in Montreal to waive the vip fee for a year and if you wait till July they'll throw in a free ipad mini.

 

That being said, be critical of what they're delivering for 125$ a year.

 

RBC offers unlimited free banking for all the years as a student. You also receive your first year of the Avion cost for free and 15,000 intro points.

If you wish to keep the Avion after the first year, there is an anunal fee of $120, but no fees for bank accounts. If you dont want to keep the Avion due to the cost, you can switch to the Signature rewards card which has the $39 annual fee waived and keep all your points earned to date and continue earning 1 point for every $1 spent.

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[mnbv]

 

 

One key distinction between RBC and Scotia is repayment. Once you're done residency, Scotia will start asking for 3% of the principal monthly in addition to interest (one year grace, based on the conversation I had with the representative that met with me.) This is pretty significant although you could refinance in a multitude of ways.

 

How sure are you about this 3% monthly repayment thing with Scotiabank? For someone with around $200,000 in debt, that would be around $6000 a month! Although doable on an attending's salary, it seems to me that many people, even with significant debt, will not want to or be able to repay $72,000+ a year.

[Birdy]

RBC does a nice job of selling you on the VIP package (3 accounts! One in US dollars!) But as Edyta mentions, there's a free student package with basic banking.

 

One key distinction between RBC and Scotia is repayment. Once you're done residency, Scotia will start asking for 3% of the principal monthly in addition to interest (one year grace, based on the conversation I had with the representative that met with me.) This is pretty significant although you could refinance in a multitude of ways.

That seems unlikely since I've heard from multiple sources that Scotia goes for a ten year repayment, while 3% monthly plus interest would make it under three years. That may be the case for their regular student LOC, but I doubt is the case with the medical student LOC.

[Borborygmi]

The documentation I saw from Scotia states that there is a 5 year repayment period if less than $10 000 is used on the LOC and a 10 year repayment period if more than $10 000 is used. Keep in mind that prime is 2.85% right now.

[RBC-HealthcareSpecialist]

RBC does a nice job of selling you on the VIP package (3 accounts! One in US dollars!) But as Edyta mentions, there's a free student package with basic banking.

 

One key distinction between RBC and Scotia is repayment. Once you're done residency, Scotia will start asking for 3% of the principal monthly in addition to interest (one year grace, based on the conversation I had with the representative that met with me.) This is pretty significant although you could refinance in a multitude of ways.

 

As a student, 3 accounts are not usually required when you can get a free E-Savings account and free E-US account on top of the free chequing account. Take advantage of the freee accounts while you can

Correct on the repayment difference. With RBC, you still receive the 12 month grace period at interest only before repayment starts. You can however apply to convert your student LOC to a professional one during the 12 month grace period or once you start practicing (assuming your credit is still in tip top shape) and maintain interest only payments at prime rate.

This is a huge bonus when you start to have unexpected expenses, taxes etc as a practicing physician.

[RBC-HealthcareSpecialist]

That seems unlikely since I've heard from multiple sources that Scotia goes for a ten year repayment, while 3% monthly plus interest would make it under three years. That may be the case for their regular student LOC, but I doubt is the case with the medical student LOC.

 

At RBC, any amount owed in excesxs of $50,000 is repayable over a 15 year amortization, $25,000 to $50,000 is 10 years and anything under $25,000 its 5 year repayment - these are blended payments (principle and interest) at prime rate

[Birdy]

At RBC, any amount owed in excesxs of $50,000 is repayable over a 15 year amortization, $25,000 to $50,000 is 10 years and anything under $25,000 its 5 year repayment - these are blended payments (principle and interest) at prime rate

Good to know. Would love to work with RBC if all the advisors listed on the site for my school weren't on vacation/away from the office at the same time. These things happen...

 

Is it possible for another advisor to pick up an application I began with someone else?

[dassy]

Good to know. Would love to work with RBC if all the advisors listed on the site for my school weren't on vacation/away from the office at the same time. These things happen...

 

Is it possible for another advisor to pick up an application I began with someone else?

 

It's possible, but they may not be willing to give you the same offers...so remember to get everything in writing. Though your original advisor won't be happy because they get credit when they sign you. But hey, do what's best for you. If they're all on vacation just sign with somebody who can get you what you want now.

[RBC-HealthcareSpecialist]

It's possible, but they may not be willing to give you the same offers...so remember to get everything in writing. Though your original advisor won't be happy because they get credit when they sign you. But hey, do what's best for you. If they're all on vacation just sign with somebody who can get you what you want now.

All the offers are standard for Medical students, it does not matter who you deal with. An application can be picked up by another advisor if it has been started and the next person can assist in fullfilling the requirements

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[ScotiabankMedsAdvisor]

How sure are you about this 3% monthly repayment thing with Scotiabank? For someone with around $200,000 in debt, that would be around $6000 a month! Although doable on an attending's salary, it seems to me that many people, even with significant debt, will not want to or be able to repay $72,000+ a year.

The repayment of 3% of the balance is incorrect.  You have access to the funds throughout the duration of residency/fellowship and for 12 months following completion.  At that time the amount you owe converts into a loan which is repayable on a 10 year amortization.  At this point you can look at setting up a Professional Line of credit at prime to use on an ongoing basis.  In my mind repayment features shouldn't be one of the deciding factors in your decision.  This is a minimum of 7 years away if you do a Family Medicine Residency.  Banks will alter the plans over the next 7 years and the repayment options will vary from how they look today.

[ScotiabankMedsAdvisor]

Pretty sure with Scotia you get the line of credit at prime like every other bank, plus a free ScotiaOne account (usual chequing kind of account) with unlimited free transactions with the card (I get that now already as a student with them), plus you can sign up for the ScotiaGold Passport Visa and the Scotia Gold AmEx card - both of which have sweet travel rewards especially the amex because it's 4x the points. And both cards have their fees waived. If this is truly the deal (meeting with my advisor today) I'll edit this post and let you guys know but that sounds like an awesome deal to me. I would love to spend every dollar on travel rewards cards, pay them off with the LoC and get some free flights and hotels!

 

Edit: After talking to my advisor at Scotia it sounds pretty similar to RBC's plan people have talked about here - She said that the funds are not released until proof of enrollment (but the line of credit can get approved with just the letter of offer). They tend to approve without a cosignor unless you have bad credit.  It's 200 K at prime - only 50 K allowed per year but in years 2, 3, 4 they are flexible on how much you can use, if you find you need a little extra one year you can use it but then you get less for other years- AKA the whole 200K is not freely accessible from the get go. And then once you get to residency they can extend if you need more money (she didn't say how much but I'd assume up to 275 K or so). She said you get the ScotiaGold passport visa with all fees waived with a 5K limit, but if you want the AmEx card you can get that instead but you have to pay the fees for it (and it's still only 5K). If you have another credit card through somewhere else, they subtract that credit from the credit they'll give you. So, I have the Chase Amazon Visa right now with 1K limit, so they'd only give me a 4K credit card if I don't consolidate which is kinda dumb (I bet I could negotiate them on that cause it's sort of ridiculous).

 

To be honest, although I do mostly trust myself, I personally don't mind the limits set out on how much I can use per year because I think it's easier to budget if you're like "Ok I can't spend more than 50 K this year" as opposed to "WOO HOO I HAVE 200 K AT MY DISPOSAL!" but I'm also quite young (23) and not married and all of that so I might be more tempted than others to blow money because it's available. Which I'm gonna try my hardest NOT to do!

 

Edit edit: Advisor just emailed me and apparently it was recently changed so that you CAN get the AmEx card with fees waived.

With respect to the Gold Passport or the Gold American Express you can get either one of the cards.  The advisor that you met with was incorrect on a couple of factors.  The Gold American Express fee would be waived under the plan throughout school and residency/fellowship.  Also if you did want to keep the outside credit card it wouldn't lower the credit limit on your credit card.  It would lower the overall limit of your line of credit.  So instead of having a line of credit for 200,000 you would have a total limit of 199,000.  This would mean that your annual limit would be 49,750 instead of the 50,000.  Which is still well more than you will need to cover all of your costs.

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[ScotiabankMedsAdvisor]

Repayment is pretty important to me, I have no idea how I'm going to feel about making large loan payments 7 years from now.

 

Banks can alter their plans all they want so long as they consult me on any standing agreements.

I don't disagree that it's important.  My point is that banks are always improving the plans.  And by the time you reach the point where you are required to repay the loan the available options will likely have changed drastically.