After earning a medical degree, some people might think physicians are financially set for life. However, having those coveted “MD” letters following your name doesn’t mean you’ll never run into financial difficulties. Those times are when it may be wise to consider getting a physician personal loan.
A physician personal loan can help cover unexpected expenses, like relocation costs, cost-of-living expenses while you’re in training, or a large, one-time purchase. As a practicing professional or one who’s in training, unsecured personal loans for doctors can help you avoid high-interest debt while addressing urgent expenses.
Benefits of a personal loan
A personal loan is an installment loan that can finance major expenses that don’t occur very frequently in your life. For instance, a home repair could cost thousands of dollars, and you might not want to take out a home equity line of credit to pay for it.
When you’re in the midst of repaying medical school debt, you might struggle to find any extra money in the budget for expenses. Personal loans are often attractive options for physicians, because of their reasonable fees and interest rates, compared to credit cards or payday loans.
Physician personal loans can also simplify your monthly payments by consolidating multiple debts into one convenient loan with one payment and due date.
Reasons you might need a personal loan for doctors
- Finance a home repair or renovation. Homes naturally degrade and need regular updates to remain compliant with safety codes. Plus, a renovation has the potential to raise the value of your home for future resale.
- Cover emergency expenses. Sudden costs associated with a loved one’s funeral arrangements, surprise medical or dental expenses, or vehicle repairs are among the costs that a physician personal loan can address.
- Pay for large purchases. A personal loan for doctors can be used to finance new appliances for your home, for example. These aren’t regular expenses, and a personal loan might offer better interest rates than a retailer’s lender. Also, home equity lines of credit can take longer and might not fit your needs.
- Consolidate other debt. By taking out a personal loan, you can negotiate favorable loan terms under one loan servicer and then use the proceeds of the loan to pay off other debt. This can free you from continued high-interest charges on your credit cards and make your repayment process easier to manage.
4 Lenders who offer personal loans to physicians
Some lenders provide personal loans that are expressly designed for doctors, dentists and medical residents. You can often get a rate discount if you sign up for autopay, and some lenders allow for higher loan maximums than traditional loan providers.
Here are a few places to start looking for physician personal loans.
1. Laurel Road physician personal loans
Personal loans for doctors are available through Laurel Road. Laurel Road offers both personal loans for residency interviews and personal physician and resident loans. American Medical Association discounts are offered as well.
Eligibility for Laurel Road personal loans
- Must be a member of the AMA to receive an extra discount on interest rate.
- Must be a practicing physician or within 12 months of completing training, with a signed contract, to get up to $80,000.
- Must be in residency to qualify for up to $45,000.
Laurel Road’s personal loans are available to physicians pre-residency, during residency, or currently practicing. It benefits borrowers by offering reduced interest rates on the loan during their training and residency. Plus, you can get rate discounts both for AMA membership and signing up for autopay on the loan.
2. Panacea Financial PRN Personal Loans
You might consider a physician personal loan (or dentist loan) through Panacea Financial. Its loan amount goes up to $75,000 and can fund whatever you need (other than educational costs), including expenses related to interviews, exam fees, residency relocation and more.
Eligibility for Panacea Financial PRN loans
- Must be in your fourth year of medical or dental school, be in medical residency or fellowship, be a dental graduate student or practicing physician or dentist.
- You must live in the U.S. (including Puerto Rico).
- If applying as a student, you must attend an accredited U.S. medical or dental school.
- You must have a valid ID and a Social Security number.
- Only U.S. citizens or permanent residents may apply.
Panacea Financial’s PRN loans don’t require collateral. Borrowing limits are: $15,000 for fourth-year medical students, $30,000 for those in training and $75,000 for practicing doctors and dentists.
Personal physician loans with Panacea are fixed-rate and operate off simple interest instead of compound interest. There are no origination fees, and there is also an autopay discount if you pay using your Panacea Financial checking account.
3. Doc2Doc Lending
Doc2Doc Lending offers a streamlined online application process for personal loans for doctors and dentists.
Eligibility for Doc2Doc Lending in-practice loans
- Must be U.S.-based in-practice physician or dentist with MD, DO, or DDS degree.
- Must be a U.S Citizen, a permanent resident, or hold a valid O1 or H1B visa.
- Must live in the District of Columbia or any state but Iowa and West Virginia.
Eligibility for Doc2Doc Lending in-training loans
- Must be U.S.-based resident physician or dentist with MD, DO, or DDS degree.
- 4th-year medical and dental students with a successful residency match are eligible.
- Citizenship and residency requirements are the same as for in-practice loans.
Doc2Doc Lending analyzes not only your FICO score, but also physician-specific factors that can give you a better interest rate than typical lenders. No cosigner is required, and the loans are fixed-rate with no penalty for prepayment.
In the application process, Doc2Doc uses a soft credit check, rather than a hard credit inquiry that could impact your credit. You APR depends on factors like your debt-to-income ratio and the repayment terms you prefer.
Doc2Doc’s loans begin at $5,000, with a maximum loan amount of $25,000 for residents and $75,000 for practicing doctors or dentists.
4. Earnest Personal Loan Search Tool
Although Earnest doesn’t directly provide personal loans for doctors or other professions, it offers a service to help you search for the right personal loan and lender for your needs. Earnest partners with Fiona, which is a personal loan comparison and recommendation platform for physician personal loan offers.
By using Earnest’s Fiona search engine, you can easily compare various loan offers based on qualifications, interest rates and repayment terms. Using the search feature won’t impact your credit score, since you’re only comparing options.
0% credit cards vs. unsecured personal loans for doctors
As an alternative to physician personal loans, you might instead consider using a credit card with a zero-percent interest rate.
The rationale for getting a 0% interest rate credit card is that you can often open the account and pay no interest during the short introductory period. For example, you might use a card to pay for variable month-to-month expenses, such as a major home renovation project.
A zero-interest card is also an option for paying off multiple loans, simultaneously. This can function like a debt consolidation if you find a card that offers you 0% on balance transfers, too. Transferring the balance from a high-interest credit card to a 0% interest card reduces the amount you’d pay over time.
The choice between using a physician personal loan or a 0% interest credit card comes down to which option best suits your purpose. Compare your needs, like whether you need a revolving line of credit or if an installment loan will suffice, along with other criteria, like the interest rate offered, terms, and fees.
When using a credit card, pay the full balance before the zero-interest period ends to avoid costly interest charges that can lead you down a debt hole.
Should you take out a physician personal loan?
Having a higher income as a medical professional doesn’t necessarily mean you’ll never need a loan to get you through a tough time. You might experience a job loss or encounter your own medical emergency that needs to be paid sooner rather than later.
Just be sure to compare several physician personal loan offers before selecting the one that works for you.