£25000 loan... ARGH!

Careful_with_that_Axe

Is there not a financial institution that has special loans for this sorta thing? Some sort of student type loan?
Doesn't seem fair if there isn't.

SteveyLomas

sali-mali,

Professional development loans charge interest when you draw down the funds. What you are proposing is madness. You are effectively taking out a loan and putting it in a savings account, which will be at a lower rate. Roughly, you are drawing down £17k and, say, the differential is 3% (likely more as you pay tax on savings), you are throwing £500 away a year without a single benefit whatsoever.

Don't do it.

aurora_borealis_2

I'm her mum We'll be making a monthly contribution as well - but she still needs the full loan.

We're not thrilled about the level of debt - and the repayments - that she'll have to make when she graduates.

She won't be able to afford a mortgage for years, if that's what she wants!

Please keep the advice coming because I can't make any sense of it.

pavlovs_dog

could you not just go to singapore with your sister and save your poor parents some money?

im assuming you've exhausted all avenues with regards to scholarships, bursaries etc. im guessing there must be hardship loans available... could you borrow less and use those to 'top up' if necessary?

its a bit extreme, but i know the armed forces used to pay fees for med students privided you signed up for X years afterwards - could that be an avenue to explore? or dependent on what you plan to specialise in, are there any companies who would sponsor you on a similar basis?

are you eligible for any kind of student loan? if so, make sure you take it. if you do go down the PS loan route, make sure you are fully clued up on how interest is charged, whether you can overpay, are there early redemption penalties etc so that you are in the best possible situation come graduation. and shop around to get the most competitive deal.

pavlovs_dog

also, i dont really know enough about how interest is calculated and charged on PS loans to make an informed judgement about whether it is a worthwhile venture, but if you are taking it as a lump sum and saving it until needed then it needs to work damn hard to earn its keep. presumably you know that you will need £x of it each year, which means what you're sure you wont need could be tied up in a top paying fixed rate account. again, it might be an idea to take less loan and use such interest to 'top up'

pavlovs_dog

another idea (and this really is just me thinking aloud, i have no idea whether it is a shrewd or stupid idea) could you and mr AB release some equity from your house to provide a lump sum, and use the money you would have paid sali each month to pay the mortgage instead? (on the basis that mortgage rates are likely to bemore favourable that the PS loan)

or is there any future inheritence money kicking around that she could have earlier than planned?

aurora_borealis_2

pavlovs_dog wrote: »

another idea (and this really is just me thinking aloud, i have no idea whether it is a shrewd or stupid idea) could you and mr AB release some equity from your house to provide a lump sum, and use the money you would have paid sali each month to pay the mortgage instead? (on the basis that mortgage rates are likely to bemore favourable that the PS loan)

or is there any future inheritence money kicking around that she could have earlier than planned?

:eek::eek::eek:

*vomits*

pavlovs_dog

just thinking outside the box! its why you love me, remember

aurora_borealis_2

I've told them - we're going to end up like the aged parents, drinking cabbage soup, in the Willy Wonka bed!

Billy_two_speakers

sali_mali wrote: »

Hello everyone, I hope someone can give me some advice! :hello:

I'm off to med school in September so have had to take out a loan to pay for it. I've been through all of my finances, looking at students loans and grants etc and have figured out I need to borrow £25000 from HSBC as a Professional Studies Loan. So far, so scary.

Anyway, HSBC will pay me the loan however I like, so at the moment I've requested it to me paid to me in installments so that I won't spend it all at once! But then yesterday I had a flash of inspiration... Why not get it all in a lump and then stick in into some sort of high interest bond/ISA/something?

By the time I'm in a position to pay anything back I'll owe HSBC over £41000 :eek: I'd like to have some sort of saving to give myself some breathing space, maybe I could use it for a deposit on a flat or something because I'll have NO spare money when I graduate!

Can anybody advise me on the best thing I could do with this loan? I'll need just over £8000 for my first year of Med school, so have £17000 to play with... Any ideas?

You need serious advise from experts... more than once newspapers have run items on the strange and expensive costs of becoming a dr the company thats often listed as the one best placed to help is this one (Times last year)
http://www.m2financial.co.uk/ (there are many more)

the last time I read something on this the bottom line was if you have a good chance of passing.... its just a cash flow problem as a GP is now on a 100k a year good luck