Consolidating medical school loans


08-Dec-2016 11:12

Refinancing medical school debt can lower interest rates and lower payments saving young physicians thousands of dollars over the life of their loans.

According to the Association of American Medical Colleges (AAMC), four out of five doctors will graduate with medical school debt averaging 0,723, so a 1% lower interest rate could save the average new doctor

Refinancing medical school debt can lower interest rates and lower payments saving young physicians thousands of dollars over the life of their loans.According to the Association of American Medical Colleges (AAMC), four out of five doctors will graduate with medical school debt averaging $180,723, so a 1% lower interest rate could save the average new doctor $1,800 a year.The sad situation for us medical students is that we will owe more than 6 times the average salary in the US (6 x $40,000 = $240,000) by the time we graduate, if we borrow the total amount for all 4 years. According to the Association of American Medical Colleges (AAMC), the median medical school loan for 2010 was $160,000. Since we’re dealing with big money here, it would be beneficial to know some basics about loans.When we obtain a loan, we would have to pay back more than we have borrowed. For example, if we borrow $100 and the interest rate is 5% per year, we would have to pay back $105 by next year. Sometimes, it is not possible to pay back the loan within a year. So the year after that, assuming the same 5% interest, we do not pay back $110 but $110.25.There is no interest benefit for consolidating a government loan — the rate stays the same.As for private loan consolidation, you may get lower rates (which are set by the lender).

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Refinancing medical school debt can lower interest rates and lower payments saving young physicians thousands of dollars over the life of their loans.

According to the Association of American Medical Colleges (AAMC), four out of five doctors will graduate with medical school debt averaging $180,723, so a 1% lower interest rate could save the average new doctor $1,800 a year.

The sad situation for us medical students is that we will owe more than 6 times the average salary in the US (6 x $40,000 = $240,000) by the time we graduate, if we borrow the total amount for all 4 years. According to the Association of American Medical Colleges (AAMC), the median medical school loan for 2010 was $160,000. Since we’re dealing with big money here, it would be beneficial to know some basics about loans.

When we obtain a loan, we would have to pay back more than we have borrowed. For example, if we borrow $100 and the interest rate is 5% per year, we would have to pay back $105 by next year. Sometimes, it is not possible to pay back the loan within a year. So the year after that, assuming the same 5% interest, we do not pay back $110 but $110.25.

There is no interest benefit for consolidating a government loan — the rate stays the same.

As for private loan consolidation, you may get lower rates (which are set by the lender).

While the interest savings and lower payments may sound appealing, physicians should use caution when refinancing federal direct loans, which have some protections that private lenders usually do not offer.

,800 a year.

The sad situation for us medical students is that we will owe more than 6 times the average salary in the US (6 x ,000 = 0,000) by the time we graduate, if we borrow the total amount for all 4 years. According to the Association of American Medical Colleges (AAMC), the median medical school loan for 2010 was 0,000. Since we’re dealing with big money here, it would be beneficial to know some basics about loans.

When we obtain a loan, we would have to pay back more than we have borrowed. For example, if we borrow 0 and the interest rate is 5% per year, we would have to pay back 5 by next year. Sometimes, it is not possible to pay back the loan within a year. So the year after that, assuming the same 5% interest, we do not pay back 0 but 0.25.

There is no interest benefit for consolidating a government loan — the rate stays the same.

As for private loan consolidation, you may get lower rates (which are set by the lender).

While the interest savings and lower payments may sound appealing, physicians should use caution when refinancing federal direct loans, which have some protections that private lenders usually do not offer.

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You cannot consolidate loans until after you graduate. Getting a lower interest rate is one of the top reasons to consolidate.Medical school student loans come in two flavors: private and direct.Federal direct loans, also known as “Ford loans”, are issued by the federal government and come with some benefits and protections that private loans may not offer, including: Physician Family Financial Advisors does not endorse any lender listed here and receives no compensation from the sale of any financial product.For some student-borrowers attending medical school, the most prudent approach is to group the loans together, into a single restructured consolidation loan.

The best path for medical school loan consolidation varies, depending on what types of loans are held, and when they were originally issued.

So instead of making multiple monthly loan payments, you will only have to make one or two payments.