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Requirements to be approved for LOC

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Hey everyone,

I'm just wondering if anyone has any experience or knowledge on how difficult/easy it is to be approved for a professional student line of credit. As a young student just out of undergrad, I naturally have very little in the way of savings. With that being said, I've managed to come out of undergrad with no debt. I've heard of a family member in veterinary school who had trouble being approved, though I don't know about those circumstances. I believe I have good credit, so should that along with my acceptance be enough, in theory?

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On 12/30/2017 at 11:11 PM, exo said:

Hey everyone,

I'm just wondering if anyone has any experience or knowledge on how difficult/easy it is to be approved for a professional student line of credit. As a young student just out of undergrad, I naturally have very little in the way of savings. With that being said, I've managed to come out of undergrad with no debt. I've heard of a family member in veterinary school who had trouble being approved, though I don't know about those circumstances. I believe I have good credit, so should that along with my acceptance be enough, in theory?

I can't speak for any other banks but unless you have bad credit history (late payments, collections, bankrupcy etc.) or very little to no credit history you shouldn't have a problem qualifying for a LOC with Scotiabank. If you have very little or no credit history, or if your credit history isn't the greatest you may be required to get a parental or spousal co-signor. If your credit history is really bad you won't be approved even with a co-signor. By the sounds of it you shouldn't have a problem in qualifying on your own given the information you provided.

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On 2018-01-02 at 10:30 AM, ScotiabankHalifax said:

I can't speak for any other banks but unless you have bad credit history (late payments, collections, bankrupcy etc.) or very little to no credit history you shouldn't have a problem qualifying for a LOC with Scotiabank. If you have very little or no credit history, or if your credit history isn't the greatest you may be required to get a parental or spousal co-signor. If your credit history is really bad you won't be approved even with a co-signor. By the sounds of it you shouldn't have a problem in qualifying on your own given the information you provided.

Is the best way to go about inquiring with ScotiaBank to make an appointment in-branch? I called and someone suggested I do it over the phone with the sales department. I also see there is a SPSP representative for the school. Should I instead call them directly?

And one last thing if you know; what can be used as proof of acceptance? I have my letter, but should I request something more official from the school?

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6 minutes ago, exo said:

Is the best way to go about inquiring with ScotiaBank to make an appointment in-branch? I called and someone suggested I do it over the phone with the sales department. I also see there is a SPSP representative for the school. Should I instead call them directly?

And one last thing if you know; what can be used as proof of acceptance? I have my letter, but should I request something more official from the school?

Yes call them directly. Your acceptance letter will suffice to get the application process going.

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On 1/2/2018 at 10:30 AM, ScotiabankHalifax said:

I can't speak for any other banks but unless you have bad credit history (late payments, collections, bankrupcy etc.) or very little to no credit history you shouldn't have a problem qualifying for a LOC with Scotiabank. If you have very little or no credit history, or if your credit history isn't the greatest you may be required to get a parental or spousal co-signor. If your credit history is really bad you won't be approved even with a co-signor. By the sounds of it you shouldn't have a problem in qualifying on your own given the information you provided.

Any insight to the extent high utilization will be a concern? I have a 7 year mostly perfect credit history that contains a number of different credit products. No late payments or blemishes other than my credit utilization being quite high. I'm trying to get it down to around 40% by the time I apply for a LOC in the spring. 

Thanks

 

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On 1/12/2018 at 9:39 PM, Toad said:

Any insight to the extent high utilization will be a concern? I have a 7 year mostly perfect credit history that contains a number of different credit products. No late payments or blemishes other than my credit utilization being quite high. I'm trying to get it down to around 40% by the time I apply for a LOC in the spring. 

Thanks

 

 

I won't be able to accurately speculate as to how much of a concern that might be in your particular case as it depends on a lot of variables. If you're concerned and would really like to have a bit more insight I'd suggest you pull your credit report from either Equifax or TransUnion to have a better idea of your score etc. You'd have to order it online and pay a fee for the more detailed report, it should cost something like $25 or so.

 

It doesn't sound too concerning from the limited information you've provided, I'd suggest just applying in the spring as you planned. Again, I don't see the big picture so take that with a grain of salt. The lender will be pulling your credit anyways and they can let you know if there are any issues at that time.

Edited by ScotiabankLawAdvisor

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If anyone is trying to get Scotiabank to lower their rate to prime and needs proof of a competing offer, I'd be happy to email you the brochure I received from RBC detailing their prime rate offering. It's only for U of T, Osgoode, Alberta, UBC and Western though.

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Just a quick note: you guys can get your credit reports for free from CreditKarma and Borrowell. CreditKarma pulls information from Transunion while Borrowell pulls your Equifax data. 

Sign up for both of them. CreditKarma updates weekly (or is it biweekly?), but Borrowell only updates once a month. 

@ScotiabankLawAdvisor  Two questions:

1) I had an excellent credit score for years (in the 800's), but last month a bill was reported to Transunion and my Transunion credit took a big hit. I've since resolved the issue. My Equifax credit is still excellent, but my Transunion credit fell into the "good" territory. I also have that blemish in my Transunion history now. How big of a concern is this?? 

2) If it is an issue, is there a possibility that I can use my substantial savings as collateral? I can show roughly 250k in funds divided between a non-registered account and my TFSA/RRSP. 

Thanks. 

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12 hours ago, Abii said:

Just a quick note: you guys can get your credit reports for free from CreditKarma and Borrowell. CreditKarma pulls information from Transunion while Borrowell pulls your Equifax data. 

Sign up for both of them. CreditKarma updates weekly (or is it biweekly?), but Borrowell only updates once a month. 

@ScotiabankLawAdvisor  Two questions:

1) I had an excellent credit score for years (in the 800's), but last month a bill was reported to Transunion and my Transunion credit took a big hit. I've since resolved the issue. My Equifax credit is still excellent, but my Transunion credit fell into the "good" territory. I also have that blemish in my Transunion history now. How big of a concern is this?? 

2) If it is an issue, is there a possibility that I can use my substantial savings as collateral? I can show roughly 250k in funds divided between a non-registered account and my TFSA/RRSP. 

Thanks. 

That depends on what you mean by "a bill was reported to Transunion". If it was a 30 day late and it's a one off then I wouldn't worry. If it's something more serious like a collection or a write off it could be problematic. Regardless, by the sounds of it I wouldn't worry too much since you said you've resolved it and you're still sitting in the "good" territory.

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4 hours ago, ScotiabankLawAdvisor said:

That depends on what you mean by "a bill was reported to Transunion". If it was a 30 day late and it's a one off then I wouldn't worry. If it's something more serious like a collection or a write off it could be problematic. Regardless, by the sounds of it I wouldn't worry too much since you said you've resolved it and you're still sitting in the "good" territory.

It unfortunately was a collection. Basically I had an ongoing argument with my old union over something internal (the union I was in has a rule that says no member is allowed to work for a non-union company. The penalty is suspension from the union and the "guilty" party also has to return all education costs). In the oil downturn I ended up working for a non-union company and they found out. Long story short we went back and forth for a few months and ended up cutting ties. Two years later they sent my 3000 dollar debt to a collection agency and the agency reported it. I paid it all immediately and the account is now closed. On my credit record the account shows as "closed" and "paid."

Hopefully it won't be a big concern. 

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21 hours ago, lawgirly said:

@ScotiabankLawAdvisor for scotia's professional student LOC - how many years do you have to pay back the loan? 

Repayment would work like this right now:

Repayment starts a year after finishing articling. At that time you have the option to either pay interest only for a year and start principal repayment two years after finishing articling, or start pricipal repayment a year after articling. At that point, the amortization usually defaults to 10 years, but can be extended to 15 years at your request.

law school (3 years no payments) + articling (1 year no payments) + grace period year (1 year no payments) + interest only grace period (1 year interest only payments) + regular repayment (10-15 years max) - during regular repayment you may also defer principal payments on loans for periods up to 12 months upon the birth or adoption of a child (maternity or parental).

Hope that helps!

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On 3/13/2018 at 8:02 AM, ScotiabankLawAdvisor said:

Repayment would work like this right now:

Repayment starts a year after finishing articling. At that time you have the option to either pay interest only for a year and start principal repayment two years after finishing articling, or start pricipal repayment a year after articling. At that point, the amortization usually defaults to 10 years, but can be extended to 15 years at your request.

law school (3 years no payments) + articling (1 year no payments) + grace period year (1 year no payments) + interest only grace period (1 year interest only payments) + regular repayment (10-15 years max) - during regular repayment you may also defer principal payments on loans for periods up to 12 months upon the birth or adoption of a child (maternity or parental).

Hope that helps!

Are we able to do lump sum payments after we graduate? What's the max we can pay off in one payment? I know you can do this with regular government student loans, but not with mortgages (max with mortgages is 25 percent at credit unions I think). 

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I was able to make lump sum repayments of any amount on my Scotia PSLOC.

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On 3/17/2018 at 9:46 AM, Abii said:

Are we able to do lump sum payments after we graduate? What's the max we can pay off in one payment? I know you can do this with regular government student loans, but not with mortgages (max with mortgages is 25 percent at credit unions I think). 

There is no maximum as to how much you can pay at any time, you are free to pay the whole balance at any time without any penalty. It is not like a mortgage in that sense.

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2 hours ago, ScotiabankLawAdvisor said:

There is no maximum as to how much you can pay at any time, you are free to pay the whole balance at any time without any penalty. It is not like a mortgage in that sense.

Does our interest rate change once repayment of principal begins? 

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What’s the likelihood of getting a PSLOC with basically no income without a co-signer? I know TD won’t give me anything due to the lack of income, even with my credit score being just fine. 

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