Medical Residency and Relocation Loans
Medical Residency Loans
Once you’ve graduated medical school, you will need to complete your internship and residency. And chances are, you may be low on funds to cover expenses like relocation, housing, and other living expenses. There are no federal student loans available to cover expenses related to medical residency and relocation, however, many private lenders offer medical residency and relocation loans specifically for this purpose.
Residency Relocation Loan
A residency and relocation loan is a great option for recent medical school graduates encountering additional expenses as they complete their medical training. These loans are available to cover exam prep, residency interviews, the cost of relocating, and can assist in covering living expenses such as housing, transportation, groceries and more.
Best Private Student Loans for Medical Residency and Relocation
Best Residency Relocation Loan
Each lender has their own terms and conditions when it comes to their residency and relocation loans, but here are some common features:
- Borrow up to $30,000, depending on the lender
- Cover expenses related to medical residency, relocation, board exam prep, transportation, living expenses, groceries and more.
- Up to a 15 or 20-year repayment term, with no prepayment penalties
- Payments may be deferred for up to 7 years during the residency
- Cosigner release option may be available after 12 to 48 consecutive, on-time payments
- Fixed or variable interest rates are available
Sallie Mae® Medical Residency and Relocation Loan
Sallie Mae allows you to borrow up to $30,000 in their Medical Residency and Relocation Loan. These funds can be used to help you pay for your board exam fees, transportation, and living expenses. Fixed and variable rate options are available, and repayment terms can be flexible. If needed, you do have the option to apply with a cosigner.
Discover Residency Loans
Depending on your specialty, Discover offers residency loans for up to $18,000. These funds can be used to help you cover the costs of your residency, internship, relocation, and board exam review. Fixed and variable rate options are available, with zero fees, and flexible repayment options.
Eligibility Requirements for Medical Residency Relocation Loans
Medical residency and relocation loans are available to students in their final year of medical school, or medical school students who have graduated within the last 12 months.
Since residency and relocation loans are private student loans, they have the same eligibility requirements as most other private student loans:
- You must be a U.S. citizen or permanent resident, or a creditworthy cosigner who is a U.S. citizen or permanent resident will be required.
- If you are the sole applicant, you must have reached the age of majority in your state of residence. If you do not meet the age of majority requirements in your state, a creditworthy cosigner will be required.
- You must satisfy the credit criteria as required by your potential lender. If you cannot meet the credit criteria, you will need a creditworthy cosigner.
Medical School Loan Repayment During Residency
Your medical school loans will enter repayment six months after your graduation from medical school. You may have an option to postpone making payments during your residency, but these loans will continue to accrue interest during that time. We recommend making payments during residency to prevent interest from accumulating. If you have federal student loans, you may be eligible for payment postponement using a forbearance. Contact your loan servicer to determine your options.
Medical School Loan Refinance
Another option is medical school loan refinance. Some student loan refinance lenders offer the ability to refinance your student loans while you’re still in residency. Student loan refinancing may make your loans more manageable. Refinancing allows you to potentially achieve the following:
- Reduced monthly payments
- Lower interest rate
- Extended repayment terms
Residency Relocation Loan FAQ
Can a federal student loan be used to help cover residency or relocation costs?
Unfortunately, there are no federal student loan options available to cover residency or relocation costs, meaning you may not borrow any new federal loans to cover these expenses. However, if you have any unused federal student loan funds you can use those funds towards residency relocation.
How much should I borrow in medical residency relocation funds?
You may be able to borrow up to $30,000. But you may not need this much. Anytime you are using loan funds to help you fund your education, you should borrow only what you need. You don’t want to end up with an unmanageable amount of debt.
Before you borrow funds, make sure you create a budget and outline how you will manage the funds you receive. Many lenders don’t charge prepayment penalties, but make sure you double-check the terms and conditions of your loans.
When should I apply for a residency loan?
You can apply for a residency loan within your last year of medical school, or within 12 months of graduation. You should apply as soon as you realize you will need additional help to cover the costs.
What is my interest rate going to be?
Your interest rate will be determined by your creditworthiness; either yours alone or with a cosigner (if applicable). Once you have selected a lender, they can give you additional insights on your projected rates.
The interest rate may be fixed or variable. A fixed rate remains unchanged for the life of the loan. A variable rate changes periodically, typically on a monthly or quarterly basis.
When a variable rate changes, your monthly payments may increase or decrease.
Can I borrow a residency location loan with bad credit?
If you can find a strong creditworthy cosigner, you may still be eligible to borrow a residency relocation loan. If you need a cosigner to qualify, you may want to find a medical residency relocation loan which has a cosigner release option.
What is the difference between a residency relocation loan and a personal loan?
While these are both unsecured debts, they are a bit different in their purpose.
- Medical residency loans are specifically for students in their residency with features and eligibility requirements that are similar to medical school loans.
- Personal loans can be borrowed for a variety of reasons, and they don’t offer the same type of deferment opportunities as medical residency loans.
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