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

[schmitty]

Hi everyone,

 

I just came back from my meeting with a Scotiabank LOC rep, and she informed me that in order to receive the full amount of $200k for medical school, I would need to close any external credit cards (i.e., TD, RBC). If not, the amount I am approved for for each credit card will be deducted from my amount that I will be approved for my LOC.

 

1. Is this common practice? 

2. Did anyone else also get 200k for Scotiabank, and then up to 75k approval in residency?

 

Thank you!

 

I am with RBC which gives 250K up front, but for the second part, yes it is pretty common for them to ask you to close some accounts (particularly if they are large) or have that amount come off your LOC. For example, I had about 5 credits cards (none with balances) with several limits >$10K, 1 personal LOC at $10K and a joint LOC at $15K. I closed all the LOCs (the new one is a MUCH lower interest rate anyway), canceled 2 of the credits cards that I never use anyway, and they were fine giving me the $250K.

[lisait'syourbirthday]

Scotia now offers me 275k plus the Passport visa gold AND the AMEX gold with no fees. That's not standard but was able to work out a deal. 

How did you get them to do that (give you more than 200K)? Did you just ask? They said they would give me 200K and another 75000 in residency if I need it

[kuzco]

Hey everyone, 

 

I'm pretty new at this taking care of my finances thing so I would really appreciate your advice.

 

The first one (and the only one so far) I have talked to is TD and they said that they won't offer me any "perks" at all (no credit cards fee waived etc.). However, when I did mention about other banks doing that like RBC, they said that 12 months after you graduate at RBC you go on a fixed payment plan where your monthly payment can be pretty high but in TD they offer 1% of balance or $50 dollar payment.

 

While having perks would be nice, the repayment thing seems like a big deal. I still haven't met up with Scotia or RBC yet but I'm going to be out of the country for the latter part of the summer and have to take care of few things before I start medical school this fall. So I don't have a lot of time to shop around.

 

Should I just take it with TD? and if I do the paperwork to get approved by TD now, would I lose the opportunity to find good deals if I switch to another bank later vs if I approach them without starting a LOC elsewhere?

 

Thanks a bunch!

[Borborygmi]

Should I just take it with TD? and if I do the paperwork to get approved by TD now, would I lose the opportunity to find good deals if I switch to another bank later vs if I approach them without starting a LOC elsewhere?

 

After looking at all major institutions, I personally found TD to be the weakest of all in terms of what you can get. I think you should take what's most comfortable for you, however.

 

The only thing to consider from your question above is that each time an institution runs a credit check on you, it softens your credit score by 5 points. I would suggest holding off taking the plunge and allowing any institution from running a credit check on you until you have decided which institution best fits your needs.

[doctorfresh]

Can anyone with a CIBC LOC chime in on what perks they received there or what credit card is best to get there with a LOC? I am thinking of maybe switching to Scotia if they are able to offer me the visa infinite momentum with the LOC.

[toxscreen]

What's the point of the Scotia Gold Passport if you get the Scotia Gold AMEX (which gets you 4x points on certain purchases)?

[schmitty]

After looking at all major institutions, I personally found TD to be the weakest of all in terms of what you can get. I think you should take what's most comfortable for you, however.

 

The only thing to consider from your question above is that each time an institution runs a credit check on you, it softens your credit score by 5 points. I would suggest holding off taking the plunge and allowing any institution from running a credit check on you until you have decided which institution best fits your needs.

 

 

I wouldn't worry about any tiny impact of multiple credit checks on your account, especially at this point. By the time you need another significant credit (i.e. buying a house in residency or beyond), those credit checks will not be a factor at all. 

[oshaku]

What's the point of the Scotia Gold Passport if you get the Scotia Gold AMEX (which gets you 4x points on certain purchases)?

Because a lot of places don't accept amex

[rmorelan]

Because a lot of places don't accept amex

 

and that is because amex charges the store for the ability to use their credit system (which is how in part they are paying for the points). Stores don't exactly like that idea. ha, it also mean if you are not using a rewards card then you are effectively subsidizing with your purchases those that do (store has to recoup costs somehow).  

[toxscreen]

Because a lot of places don't accept amex

 

 

and that is because amex charges the store for the ability to use their credit system (which is how in part they are paying for the points). Stores don't exactly like that idea. ha, it also mean if you are not using a rewards card then you are effectively subsidizing with your purchases those that do (store has to recoup costs somehow).  

Ahhhhh, tyty.

[Liz30]

and that is because amex charges the store for the ability to use their credit system (which is how in part they are paying for the points). Stores don't exactly like that idea. ha, it also mean if you are not using a rewards card then you are effectively subsidizing with your purchases those that do (store has to recoup costs somehow).  

 

All credit cards have a percentage rate that merchants (store owners) are charged per transaction. One of the agreements store owners make with credit card companies is that if they accept one card (e.g. a basic Visa), they have to accept all cards of that brand (aka all Visas). The more bonuses a credit card has on it - reward points, cash back, insurance, etc - the higher the charge for the merchant. So to use Visa as an example, using TD's Visa Infinite card costs the merchant a much higher percentage than if someone was to use a basic no frills Visa. This article is a good read for anyone who's interested in this type of stuff http://globalnews.ca/news/1652367/visa-mastercard-canada-agree-to-lower-transaction-fees/

[rmorelan]

All credit cards have a percentage rate that merchants (store owners) are charged per transaction. One of the agreements store owners make with credit card companies is that if they accept one card (e.g. a basic Visa), they have to accept all cards of that brand (aka all Visas). The more bonuses a credit card has on it - reward points, cash back, insurance, etc - the higher the charge for the merchant. So to use Visa as an example, using TD's Visa Infinite card costs the merchant a much higher percentage than if someone was to use a basic no frills Visa. This article is a good read for anyone who's interested in this type of stuff http://globalnews.ca/news/1652367/visa-mastercard-canada-agree-to-lower-transaction-fees/

 

exactly. So you can imagine if you are in retail and your net profit overall is in the 5-10% of sales range you aren't too happy about visa 1.5 to 3% "transaction fee" - a fee for which they basically don't do very much. Oh and cash is immediately available to you but with say visa there is also a lag for your payment. Not to mention all the wonderful stuff visa gets to do with all of your marketing data (it knows where  and when you've been shopping, it knows where you live, it knows a lot about you - and who your friends are as well - data, data, data).

 

The CC companies make money before you even pay a dime in interest. Brilliant middle man parasite business model - and like most good parasites you don't even really realize they are there, but in the end their profit is passed on to you in the form of higher prices the merchants need to charge to make up the overall gap.

[RBC-HealthcareSpecialist]

 

The first one (and the only one so far) I have talked to is TD and they said that they won't offer me any "perks" at all (no credit cards fee waived etc.). However, when I did mention about other banks doing that like RBC, they said that 12 months after you graduate at RBC you go on a fixed payment plan where your monthly payment can be pretty high but in TD they offer 1% of balance or $50 dollar payment.

 

 

 

- With RBC, your reapayment is over 15 years based on the balance at prime rate (after the 12 month grace period), you do have an option to convert the student credit line to an interest only professional credit line which allows you to maintain interst only payments and full access to the credit line. So far, we have been the only bank offering this options and our clients enjoy the freedom of making payments that fit their budget as long as they pay the interest.

[toxscreen]

Any thoughts on Scotia's Gold Passport+Gold Amex combo versus RBC's Signature Visa?

[ParkourParkour]

Any thoughts on Scotia's Gold Passport+Gold Amex combo versus RBC's Signature Visa?

 

The amex gold will get you 4x the points on everyday purchases while the visa gold passport will cover anywhere that doesn't accept amex. the scotia rewards system isn't the best in terms of the flight prices/what you can get for the points you earn but i'm sure the same can be said about RBC/TD/CIBC rewards cards. Until you get to the Amex Platinum/Visa Infinite Prestige (see: not available for students/residents with a basic LoC) level of cards, pretty much all rewards cards are somewhat equal.

[toxscreen]

Yeah I was thinking that they all seemed pretty similar, just wanted to make sure I didn't miss anything. Thanks for the reply.

[lisait'syourbirthday]

The amex gold will get you 4x the points on everyday purchases while the visa gold passport will cover anywhere that doesn't accept amex. the scotia rewards system isn't the best in terms of the flight prices/what you can get for the points you earn but i'm sure the same can be said about RBC/TD/CIBC rewards cards. Until you get to the Amex Platinum/Visa Infinite Prestige (see: not available for students/residents with a basic LoC) level of cards, pretty much all rewards cards are somewhat equal.

I am wondering if they had to split your credit limit between the Passport Gold and the Amex Gold cards? Apparently I was approved for a credit limit of 5000, so they'd have to split it between two cards (for example, 2000 on one and 3000 on the other). However, both gold cards need to have a minimum credit limit of 5000 (just a requirement for gold cards), so basically I can't have both cards. Did anyone else encounter this at Scotiabank and what should I do?

[ParkourParkour]

I am wondering if they had to split your credit limit between the Passport Gold and the Amex Gold cards? Apparently I was approved for a credit limit of 5000, so they'd have to split it between two cards (for example, 2000 on one and 3000 on the other). However, both gold cards need to have a minimum credit limit of 5000 (just a requirement for gold cards), so basically I can't have both cards. Did anyone else encounter this at Scotiabank and what should I do?

 

got $5000 each on my Visa Infinite Momentum and Amex Gold. might be because of the resident LoC extension...

[lisait'syourbirthday]

got $5000 each on my Visa Infinite Momentum and Amex Gold. might be because of the resident LoC extension...

Sorry could you elaborate a bit more? By resident LoC extension do you mean the $75000 that they can give you in residency? So when you signed initially (before you started med school), you signed for an amount of 275K and not 200K?

[ParkourParkour]

Sorry could you elaborate a bit more? By resident LoC extension do you mean the $75000 that they can give you in residency? So when you signed initially (before you started med school), you signed for an amount of 275K and not 200K?

 

signed for $200k before i started medical school. signed for another $75k when i learned where i matched.

[lisait'syourbirthday]

signed for $200k before i started medical school. signed for another $75k when i learned where i matched.

 

But you had a $5000 limit on EACH card right when you signed for the 200K right? Sorry for all the questions. My advisor made it sound like it can not be done so I just want to be sure that it has been done.

[ParkourParkour]

But you had a $5000 limit on EACH card right when you signed for the 200K right? Sorry for all the questions. My advisor made it sound like it can not be done so I just want to be sure that it has been done.

 

Ohhhh. sorry for the misunderstanding! I had just one credit card throughout medical school (the Scotia Passport) and when I signed for the $75k LoC, my advisor offered me two better credit cards.

[lisait'syourbirthday]

Ohhhh. sorry for the misunderstanding! I had just one credit card throughout medical school (the Scotia Passport) and when I signed for the $75k LoC, my advisor offered me two better credit cards.

 

Ahhhh thank you! That helps

[Economist]

I haven't talked to my advisors yet (will do that next week) but I had a question regarding the Scotiabank passport visa and the AMEX. 

Do the rewards points from the two cards stack? By that I mean if I got 1000 points each in two cards, I can redeem an item worth 2000 points? 

 

Also for the RBC folks, anyone successful in upgrading their visa card from the lacklustre Signature Visa to something like Visa Infinite Avion ?  

[Sisushi]

Did anyone who went with Scotia have issue with being allowed 1/3 of 200k in first year? I'm worried that it might run over. When CIBC did ny budget with me it worked out to be higher than Scotia's limit, but the advisor I spoke to at Scotia didn't think it would be a problem.

 

Also, yes, the two scotia cards points stack, at least that's what I was told at the Hamilton branch.