Dental School Loans: How to Refinance and Consolidate
Dental school Loans is expensive. Very expensive. Reports show that dental School Loans education is the most expensive of all higher education fields. And the vast majority of new practitioners emerge with such enormous debt loads, it makes one wonder:
Is Dental School Loans Worth It?
Financing a dental school Loans education is not an idle concern: 80% of 2016 dental school Loans graduates have more than $100,000 in debt.; 30% were on the hook for more than $300,000. This is not a condition that will go away anytime soon. The American Student Dental Association reports that graduates in 2017 had a record high $287,331 in dental school Loans debt.
Notably, dental school Loans grad debt crowns the money borrowed for a four-year degree in addition to four years of dentalSchool Loans.
Looking for a reason for rising debt rates?
Simple economic principles: Driven by supply and demand, prices up to the metric are rising. Enrollment in predoctoral dental School Loans education programs reached nearly 25,000 in the 2016-17 academic year, a 2% increase over the previous year.
However, with plenty of options, students pursue dentistry as a career for a variety of reasons. Dentistry can be profitable, or at least financially secure. Many dentists are their own bosses. Dentistry can also be personally rewarding. Many dentists provide pro-bono services to patients in need in their communities and abroad.
Moreover, those of us who have teeth — especially those who want to keep them — need an influx of new dentists … and we need them not to be distracted by their student debt while they’re pounding away at our molars. Fortunately, there are strategies for managing dental School Loans debt that are more than just a pretty look at the problem, potentially putting all of our minds at ease.
Private Student Loan Refinance Options
Private lenders will refinance any sort of student loan, including federal loans. While their terms for the length of a loan might not be as long, the interest rates are likely to be lower, saving the borrower thousands over the life of the loan.
Two of the student loan refinancing lenders are SoFi and LendKey.
Typical features of a SoFi refinance loan include:
- Five-, seven-, 10-, 15- and 20-year terms
- Fixed and variable rate loans
- With autopay as low as 2.615% APR and fixed rates as low as 3.35% APR
- There are no origination fees, application fees or prepayment penalties
- Consolidation of existing student loans (federal and private) into one monthly payment
- $300 welcome bonus
- Career strategy services, member events and referral programs
LendKey serves as a digital liaison between hundreds of small banks and credit unions that want a piece of the student loan marketplace, but lack the IT knowledge or personnel to build and maintain nifty websites and infrastructure. By bringing them under its umbrella, LendKey opens up refinancing opportunities in your backyard.
That said, eligibility rules – primarily geographic – may limit which of the LendKey members can partner with you.
Related: Best Personal Loans Of 2022
Typical LendKey refinancing features include:
- Five-, seven-, 10-, 15- and 20-year terms
- Variable interest rates from 2.76-7.90% APR. Set rates from 3.15-8.54%
- Loan Amount: Minimum $5,000. A maximum of $300,000 for a medical, dental or veterinary degree.
- Better credit scores get better rates, but scores as low as 660 can qualify.
- The minimum debt-to-income ratio, which does not include housing costs, is 33%.
- Borrowers must have graduated from an eligible school that participates in the federal government’s Title IV federal student aid programs.
- Unlike many private lenders, LandKey includes a forbearance clause for struggling borrowers — up to a year in four-month installments for short-term loans, up to a total of 18 months in six-month installments for 15- and 20-year loans.
The American Dental Association (ADA) offers private loan refinancing through Laurel Road Bank. Among the key features: Qualified members receive a 0.25% rate reduction for as long as they remain ADA members, with potential savings in the thousands.
Other top-rated private refinancing lenders include CommonBond, Citizens Bank and Discover Student Loans.
In general, private lenders do not include the same flexible repayment terms included in federal student loans. However, private loans also run two to three points lower than federal loans, and this can work to your advantage.
Consider a $250,000 loan scheduled to be repaid in 10 years.
- 120 payments of $2,531.13 each on a private loan at a fixed 4.0% would total $303,735.60.
- A federal loan (subsidy) at 6.8% fixed in 120 payments of $2877.01 each would have a total cost of $345,241.20.
- The federal loan (subsidy) includes $95,241.20 in interest. The private loan included $53,735.60 in repaid interest, a savings of over $41,500.
How to qualify for dental school loans
Eligibility for refinancing is the same as any other non-collateralized loan. First and foremost, lenders want to make payments with as little hassle as possible. Here are the main areas they monitor:
- Credit score. Lenders want to see that you have a history of meeting your financial obligations. dental school Loans Most require a minimum score in the high 600s.
- Do you have proof of stable and recurring monthly income and cash flow? When you subtract recurring expenses from after-tax monthly income, is there room for a student-loan repayment plan?
- Other debt. Lenders will keep an eye on what you owe.
- Debt-to-income ratio, or the ratio of your gross monthly income vs. Your monthly debt obligations. A person with $10,000 in monthly income and $3,000 in monthly debt expenses has a debt-to-income ratio of 30%. Anything below 30% is considered very good.
- Most lenders want to know that you are employed, or that you have a written job offer dental school Loans.
To apply, visit the websites of many student-refinancers to review their offers and terms. Shop hard while making sure you’re comparing apples to apples. When you’ve identified potential candidates, apply to multiple lenders through their websites.
Consolidation Options for Federal Loans
If you have an assortment of federal student loans, you may want to consider consolidating them into one loan. The upside is that the feds don’t have a minimum credit requirement, and you’ll be rolling all of your federal student loan debt into one loan, potentially with a lower payment.
Reasons you might choose to integrate with Uncle Sam:
- You’re in student loan default and you want to get back on your feet
- You want to make a single payment, and not be desperate for it to be too low
- You need to consolidate to qualify for income-driven repayment or public service loan forgiveness.
Here’s how it works:
- Under federal consolidation, Washington pays off your federal loan and replaces it with one dental school Loans.
- You become eligible when you receive your diploma, leave school (for any reason), or drop below half-time enrollment.
- The Department of Education does not charge for this service. Avoid companies that charge fees to do what the feds do.
- You get a new interest rate, equal to the weighted average of your previous rates, rounded up to the next highest one-eighth of 1%.
- You get a new loan tenure ranging from 10 to 30 years; Repayment usually begins within 60 days when your consolidation loan is initially disbursed.
Here’s how you do it:
- gov, use your login and click on “Complete Consolidation Loan Application and Promissory Note”. “What do I want?” Review the section before you start, as you must finish in one session (it will take about half an hour).
- Enter the loans you do and don’t want to consolidate.
- Choose a payment plan. Want an income based plan? Complete the Income-Driven Repayment Plan Request Form.
- Review and submit your application. Continue paying your student loans until you complete the consolidation.
A variety of opportunities are available to turn your dental School Loans skills into a loan-payment generator, including serving in the military, committing to service with certain non-profit, tax-exempt organizations, or others that provide certain types of qualified public services. Out of which comes under Public Service Loan Waiver Program.
Additionally, through the National Health Services Loan Repayment Program, health professionals willing to make a short-term commitment to a medically underserved area (MUA) have the opportunity to trade on their well-earned skills in exchange for debt reduction. General or pediatric dentists who complete a two-year internship at an NHSC-approved site can earn up to $50,000 toward their dental school Loans debt. Good to know: About 41% of those who apply are approved.
Lower your monthly payment
Squeezed at the end of each month to work out all your finances? Lowering your student loan monthly payment(s) can help. Fortunately, various options exist.
- Draw up your payment schedule. This option is only available to federal student loan borrowers, and it has one obvious downside: The longer you stretch out your payments dental school Loans , the higher your total interest repayments will be.
- Choose a graduated-payment plan. If you expect your income to increase in the coming years, this can provide room in your current budget.
- Look into one of four income-based repayment plans, which cap payments as a percentage of your discretionary income.
- Consolidate your loans. We mentioned above that, under certain circumstances, consolidation can lower the monthly payment.
- Refinance at low interest rates. If the principle and loan length are the same — $250,00 and 10 years in our example above — refinancing at a lower rate will save you money each month and in the long run.
- Set up AutoPay. You can trip up 0.25 points from your APR.
Pay off your student loans fast
Don’t wait until graduation to start tackling your student debt. The sooner you cut them, the sooner you will come out from under. This is especially true of unsubsidized loans, which start earning interest as soon as the funds are disbursed. With an unsubsidized loan, when you learn, the principle is earning … interest, interest that is being rolled into your loan, a process known as capitalization.
Students: If you work part-time, or work during the summer (or any break), consider throwing at least a portion of your paycheck toward your loan. Same if you receive unexpected cash; Denying yourself now will mean getting out of debt early.
Practitioners: Look for opportunities to apply your skills and expertise outside of your regular office hours. See if you can partner with a hospital to provide odd-hours emergency room dentistry. or affiliated with other practices that offer after-work or weekend opportunities.
Above all, resist the urge to splurge on the prospect of significant money coming your way. Yes, dentists are frequently listed among the top earners, but the best way to be successful long-term is to postpone your life-larger ambitions.
Direct dollars you would otherwise spend on a bigger house, luxury transportation, country club memberships, expensive jewelry, foreign vacations, or even your own practice to eliminate your student loan debt. The sooner you bury your loans, the sooner you can take a healthy bite out of your best possible life.
We know dentists don’t get the respect they deserve. A tongue-in-cheek take on the iconic “Yadda-Yadda-Yadda” Seinfeld episode’s key moments. But managing dental school Loans debt improperly can add injury to insult.
Now, drill down to the plans that work best for you and get that debt out of your life.