A loan is not necessarily a good investment. In fact, education is more expensive than ever, and physicians and dentists can’t keep up with the rising demand for them. Fortunately, applications to medical school are also increasing, which means thousands more students searching for loans and pursuing their medical dreams.
Unfortunately, this also means thousands more students getting wrapped up in loans they don’t understand. High interest rates, hard credit inquiries, and high penalties for paying early can confuse and discourage students. So, if you want to feel in control of your loans and education, check out our list of six pivotal questions to ask any lender before you sign along the dotted line.
1. Will Applying Affect My Credit Score?
Many lenders will process a hard inquiry on your credit, which can lower your score as much as 10 points. This shouldn’t disqualify the lender automatically, but at a vulnerable time in your career, you’ll want to stick to soft inquiries instead, which don’t affect your score at all.
The sooner you can build your credit, the easier it’ll be to build financial security.
2. What Will My Interest Rate Be?
Unfortunately, many traditional lenders don’t understand the medical space and often charge higher interest rates. This is because they see the raw numbers and don’t consider the applicant’s career prospects and time after school.
That’s why the key here is to weigh your options and choose a lender that understands the medical space.
3. How Transparent Will the Loan Process Be?
Many traditional lending involves smoke and mirrors, broken promises, and bait and switch. So, getting clarity about the process and being able to see the exact terms of your loan, presented in a simple-to-understand manner, helps you make truly informed decisions about your future. If you ask the right questions, you’ll soon discover who wants to help vs. hurt you.
4. How Fast is the Application Process?
In many cases, getting a loan isn’t a one-and-done. Some lenders go through multiple people and layers before making their decision. This may not matter for some cases, but if you need a loan in an emergency or are trying to reduce your interest rate expense, time really costs money.
That’s why it’s important to understand each lender’s process and opt for lenders who care about saving time (and money) as much as you do.
5. How Quickly Will I Get My Money?
Like we mentioned in a few previous points, some lenders take a long time to process loans and actually send them to your bank account. It’s essential that you understand exactly how long their process takes and set realistic expectations for when you need the funds.
In fact, our technology is designed to quickly process applications and deposit money directly into your account in a matter of days following final loan approval. The sooner you have your funds, the sooner you continue your education.
6. Can I Pay Back My Loan Early?
Many lenders charge high penalties for early payments. Before selecting a lender, ask them if they charge those fees for early payments, as you should be wary of lenders who want you to stay in debt longer.
At Doc2Doc, we love helping medical professionals foster good financial habits, including being able to pay off loans as soon as they are able to.
If you’re interested in learning more about our services, or how we can help you with your finances as a new or training medical professional, contact us here.