Private Medical School Loans with a Co-signer
You might want to consider having a co-signer on your private medical school loan if you have a low monthly income and can not guarantee that you will be able to make the payments. It will also be beneficial to have a co-signer if you have good credit, but the person you want to co-sign with has even better credit. This is because private medical school loans are rank-based. This means that the better the credit rating on your loan, the lower the interest rate that you will be able to lock in. This might be a good time to call Mom or Dad for help!
It is important that the co-signer has a higher credit score than you do. A person with poor credit or anyone who has filed for bankruptcy in the last 7 years can not be a co-signer on a loan.
A Guaranty and is the legally binding document that is signed by the co-signer and states the terms of the loan in writing. Until this is done, the co-sign is unenforceable, therefore, the pending co-singer has no legal responsibilities towards the loan.
However, once the Guaranty is completed, the co-singer faces certain responsibilities and consequences. If it becomes necessary that the co-signer makes the monthly payments, and fails to do so, they could be subject to collection efforts and their credit rating may be seriously damaged. Also, the new co-signed loan will be worked into the co-signer's personal debt-to-income ratio and may prevent them from approval of future loans. Finally, if you as a student go into Default on your medical school loan, then not only does it affect your credit, but the co-signer's credit as well.
Make sure that the co-signer is given copies all the paperwork regarding the medical school loan. This will ensure that they understand their legal rights and obligations. This will help them know exactly what they are getting into.
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The Healthcare Career Resources column is presented by HealthcareCrossing, America's leading job search site dedicated to getting jobs for healthcare professionals.
Save Money with a Private Student Loan Consolidation from Medical School Loans
By Brooke Heath
Even as a young child practicing medicine on your stuffed animals, you knew that you were destined to become a physician. But the road to obtaining your medical degree takes more than just the ability to mend the imaginary wounds of a teddy bear.
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