Things to consider before choosing a lender for your educational loans:
You have the right to choose any lender.
The choice of a lender for your federal and private student loans is yours. The Office of Financial Aid at the University of Pittsburgh School of Medicine will process loans from any eligible lender you decide to use.
Do you have outstanding prior educational loans? If so, who is the current holder/servicer of those loans?
If you have an outstanding educational loan, it's a good idea to continue to borrow through the same lender or through a lender that uses the same servicer. Your medical school loans represent a significant financial commitment. Repayment of your loans may last up to 25 or 30 years. Therefore, your loan servicer becomes far more important than your lender.
How to research lenders.
Approach selecting your lender as a financial transaction in which you are trying to get the best value for your money. Consider cost, but also take into account the quality and longevity of the company you are dealing with and the kind of service you receive. There are several ways to gather information about lenders:
- Go to the lender's web site. Can you find what you are looking for? Do you have to apply for a loan before you get detailed information?
- Call the lender several times and ask questions. Are you able to speak to a person who is well-informed and courteous? Does the person hesitate when you ask specific questions? Do you spend a long time on hold every time you call?
The following are some things you may wish to consider when reviewing different lenders:
- How long has this lender been in the student loan business?
- Does this lender focus on a specific segment of the student loan market, such as medical student, or graduate/professional students? Does the lender have specific sites or phone numbers for medical students?
- Is this a non-profit or a for-profit lender? For-profit lenders must consider the profit expectations of shareholders in their cost of doing business.
- Does this lender offer a residency interviewing/relocation loan for medical students? Some medical students rely on this loan in their final year to meet the cost of applying for and moving to their residency.
- Will the residency interviewing/relocation loan be serviced at the same agency where the lender's federal loans are serviced?
- Does this lender have an electronic funds transfer (EFT) agreement with the University of Pittsburgh?
- Does this lender charge fees on federal Stafford loans?
- What guarantee agency will be used? Do they charge a default fee? Some lenders and/or guarantee agencies pay this fee on behalf of borrowers. If the guarantee agency charges this fee, the funds you receive will be reduced by the amount of the fee.
- Where are the loans for this lender serviced and how long has the lender used this servicer?
- Does this lender provide online access to your account when you are in school and in repayment?
- Does this lender sell its loans to other agencies? If your loans are sold, there may be changes in your servicing and your borrower benefits.
Review the borrower benefits offered by a lender.
To determine the best borrower benefit program for you, you may want to inquire about the following:
- Are all the conditions of the borrower benefits specified in a clear and easy to understand manner?
- Is the borrower benefit "front end" or "back end"? A front end benefit is given to you when you receive the loan while you usually receive a back end benefit at the start repayment. If the lender's circumstances change, this benefit could be reduced or lost.
- Is the benefit automatic or must it be earned? Examples of automatic benefits include payment of the origination and/or default fees on your Stafford loans or an interest rate reduction if you agree to have your loan payment automatically withdrawn from your bank account once you start repayment.
- Do you have to earn the benefit? Some benefits require you to make a certain number of on-time payments before the benefit beans. If this is the case, do you have a good record of paying bills on time?
- Does the benefit require you to agree to electronic servicing of your account?
- Once you make the required number of on-time payments, is the benefit permanent or must you continue to make on-time payments to retain the benefit?
- If you fail to make the required number of on-time payments, is the benefit lost forever or can you restore the benefit?
- If you use deferment, forbearance, or a non-standard repayment plan after you graduate from medical school, will you lose your borrower benefit?
- Is the borrower benefit lost if the lender sells your loan?
- Can the borrower benefit change?
- What percentage of borrowers receive the benefit?
The University of Pittsburgh School of Medicine provides direct electronic certifications and fund transfers with nationally known lenders to provide Federal Stafford loan options to students. You can visit the following lenders’ websites to begin the electronic loan application process for a Stafford loan. Or, if you prefer, contact the lender directly for more information about borrowing options available to you.
Access Group: www.accessGroup.org
Stafford Loan Interest Rate: 6.80%
Sallie Mae: www.salliemae.com/medicalfunding
Stafford Loan Interest Rate: 6.80%
PNC: www.aesSuccess.org
Stafford Loan Interest Rate: 6.80%
Citibank: www.studentloan.com/health
Stafford Loan Interest Rate: 6.80%
Lenders listed above exchange loan application information electronically with our office. Completed loan certifications are returned to lenders on a daily basis via an electronic link. In addition, loan funds from this group of lenders are sent to the University via Electronic Funds Transfer (EFT) and disbursed to the student's account the next day, eliminating the need for a paper check and student endorsement. Additional lenders may also offer electronic loan certifications and EFT with the University of Pittsburgh School of Medicine. To verify if your lender participates, please call your lender.
Please remember, you have the right to choose any lender – you are not limited to any list from our University.
The choice of a lender for your federal and private student loans is yours. The Office of Financial Aid at the University of Pittsburgh School of Medicine will process loans from any eligible lender you decide to use.
How you let us know the lender you have chosen.
To indicate the lender you have chosen, you must submit a copy of the Master. Promissory Note for your federal Stafford loan and the Master Promissory Note for your federal Grad PLUS loan (if you decide to use this loan) to the financial aid office. If you decide to borrow a private educational loan, you must submit a copy of that loan application to the financial aid office. Your loans may not be able to be processed without providing us with these documents.