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WannaBeBanker

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  1. I can confirm that the current policy is 24 months grace period after articling for law students. This has been the case for quite a while now. You would also keep your bank account free during that time, it doesn't state that about the credit card fee waivers though still says 1 year across the board on those.
  2. This is the best way to do it, get both cards so that you have the Visa as a backup for places that don't accept the Amex. There is criteria that you'll have to meet to get the Visa Infinite card though (income and/or spending minimums)
  3. This is correct, your interest will be calculated daily. The will usually get added to the balance at the end of the statement cycle, so if you pay it off before then to a zero balance the interest will pop up later down the line. You can call the bank to get a payout amount which will include the interest to date, and if you pay that amount you'll see a negative balance on the LOC until the interest is charged to bring it to zero.
  4. I would recommend reaching out to the bank that you and/or your family have the longest banking relationship with. A lot of people don't realize that having a good, long relationship with your bank/banker can go a long way in situations like this. I can tell you I've been able to help people in similar situations that have a track record we can leverage, whereas John Doe or Jane Doe walking in off the street in the same situation doesn't have much a leg to stand on in most cases in situations like this. When it comes to banking, as with almost anything in life, it's not always just about the cheapest bank accounts, credit cards, etc. A lot of people will jump from bank to bank for all these promos with accounts and credit cards they have, but staying and building a long term relationship can pay off when it you need it. The relationship between the bank and the customer can go a long way on both sides of the table when the situation arises. Reach out to your bank, sit down and discuss your situation. Bankers are people, and want to help other people get to where they need to go. At least good bankers do, and I can tell you there are a lot of good ones out there.
  5. Haha so the short answer is that I don't see anything in the credit agreement that specifically says you have to use these funds for one thing or another, but it may be implied. The closest thing I can see that would address this is "We will not be required to make any advances to you particularly if we determine that you are not in compliance with this agreement". It may be implied there that this is a student LOC and it is to be used for expenses relating to schooling etc. It's a grey area, and you guys can read through the credit agreements that you signed and the booklets that came with them for all the legalese behind them, but that was the closest thing that I could find. On to the next part - I definitely would not recommend for anyone to use these LOCs to leverage any sort of investment. Anything worth investing in would come with some degree of risk attached to it. Unless you are fully confident that if all goes south you'd still have a backup plan to be able to afford to lose most/all of the money you invested, and keep up the payments on the LOC, it would be a bad idea. Don't bank on "oh I'll have a job by then and be making money" either, because if stock markets go south so does the job market. The stock markets have been going strong for over 10 years now, and a market correction can happen at any given time. Same goes for real estate, some have pointed out that real estate in the GTA is a safe bet but is it really? And what kind of real estate can you get into in the GTA with a $100,000-150,000 LOC? You guys are going to be in school for ~4 years, if you decide to go ahead and take a chance with leveraging your LOC and something bad happens, that is not a lot of time to mitigate risk/recover if things suddenly go south. You'll probably hear lots of stories of person A who used their LOC to invest into this stock or that fund and it worked out great, or person B who figured a way to buy a piece of property in 2013 and sold it for a great profit in 2017. But these are all stories of things happening when times are good, they are just a snapshot in time. Things have been good for a really long time now, and if you look at the history of the markets you can probably say we're overdue for the opposite to happen. That's not to say that it will or it wont, but you don't want to be that guy/girl who gets caught when things go south unless you have a wealthy family or other means to ensure you'll be ok going forward. All hypothetically speaking but just think of it - if we come to a point where there is a recession/market crash, would you be comfortable knowing you used $100,000 to invest into something that is now worth only $50,000 and your job prospects coming out of law school are now looking a lot worse thanks to the economy taking a downturn, people are being laid off and let go everywhere. You still owe that money and have to pay it back, and your employment opportunities now don't look so rosy anymore either. I would hope you have a trust fund somewhere to bail you out of this mess. Anyways, bottom line is I'd say it's bad news for most people.
  6. So it has a little bit to do with the number of days in a month, but not your average daily balance. The reason you see the interest amounts fluctuating month to month is due to a couple of reasons. Your statement period begins on a certain business day of each month. This will determine how many days are in that particular statement period, and will vary depending on the number of days in the month, the actual date that the statement period starts, etc. If your statement cycle starts on the first business day of the month, that could fall on the 1st of the month if it is on a regular business day, or it could potentially be the 2nd, 3rd or 4th day of the month (see July of this year) if it happens to fall after a weekend and/or holiday. Because of this, if my math is correct, a statement period can include anywhere from 28 to 34 days in it. Now on to the second part of this, your interest is calculated daily, and charged monthly. So at the end of each day, your interest will be calculated based on the balance owing that day, and at the end of the statement cycle the interest calculated for all of the days during that period is added up and charged to the account. If you've made advances or payments throughout the month it would affect the amount of interest charged each day. The sooner you make a payment, the sooner you are no longer paying interest on that amount. The difference in interest charged for 28 days and 34 days could be quite substantial depending on the amount you owe on the line of credit. If we make a basic calculation of interest charged on $100,000 at Prime Rate (3.95%), the interest charged on a statement with 28 days would be $303.01. The interest on the same balance for 34 days $367.95. So as you can see, even though both "monthly statements" have the same balance owing, and the same interest rate, one of them has a much higher amount of interest charged on it due to the number of days in that statement period. I hope this helps to explain why you're seeing these differences on your statements.
  7. I can confirm that Scotiabank does not include any international law schools in their eligible school list anymore, so Harvard law is out. Windsor dual program is ok because it is domestic and is a joint CAN/US program.
  8. That would be amazing if true, but the federal website still says it's Prime + 2.5% and the 6 month grace period exists, but that just means no payments are required for 6 months after you graduate. Interest begins to accrue as soon as you finish school.
  9. Yes this is pretty standard practice. Before using a bank LOC to pay off any government student loans you'd want to make sure that the savings in interest outweigh the benefit of being able to claim the interest of the government student loans on your tax return, and also that you don't qualify for any repayment assistance or interest forgiveness of any sort. It's best to sit down with an advisor at that point to go through this before making any decisions/changes.
  10. It will show up as a separate account under borrowing, called Scotia Professional Student Plan.
  11. Yes you have to keep in mind that you want to leave available room for the interest to be added onto the balance at the end of each month. As your balance owing gets bigger and/or if interest rates go up, that monthly interest amount will also get bigger and bigger. The monthly interest on $40,000 owed at Prime Rate would be $130, or $1580 annually (rough figures). The monthly interest on $120,000 would be $390, or $4680 annually. Always leave as much "space" available on the LOC as you can, because the interest cost will start out small and end up way bigger when your balance gets close to the limit.
  12. I wouldn't recommend going this route as it can lead to trouble in 3rd year and later. If you max out the $100,000 after 2 years you will be left with only $35,000 left for your final year, and the interest tacked on each month gets bigger and bigger as the balance grows and/or interest rates rise. That could leave you with only $30,000 or less in actual funding for your final year after the interest is taken into account. Not only that, but once the balance exceeds the limit at any given point, you will have to start making monthly payments to bring the balance owing down below the limit each month, so be prepared to have a plan for that and a source of income to do that as you won't be able to take any more from the LOC.
  13. While the regular American Express cards issued directly through American Express are charge cards, the ones through Scotiabank are not. They are like traditional credit cards, with limits, minimum payments, etc. The "severe penalties" you mention is just the interest that is charged on the cards, which is pretty standard across the board with these premium cards (around 20% or so). None of that should matter though, because at the end of the day regardless if it's a traditional credit card or a charge card you should be paying off the balance in full each month. If you need to carry a balance on anything, that is what the line of credit is for. You shouldn't be paying any sort of interest on credit cards, use them, pay them off, get the rewards.
  14. I doubt RBC will be able to match the package from Scotiabank - you're getting $146,000 in total credit with that package, 2 premium credit cards with annual fees waived every year, Prime Rate, and the 2 year repayment grace period. TheSaskConnection hit the nail on the head with that informative post. In regards to your worry about pulling multiple credit bureaus, don't worry about that. As long as you keep the credit inquiries close to each other (I believe it's within 2 weeks) then it will be considered as only one hit on your bureau as opposed to multiple hits. Shopping around for credit, whether it be for a mortgage, student loan/line, etc. is 100% ok and you won't get dinged for that. Your credit score will help determine what terms/rates the banks can offer a lot of times, so multiple applications are good in this case to see what everyone is willing to offer you. That's not necessarily the case with these PSLOCs, as the limits/rates/terms are pretty standard for everyone and not determined by your credit score although with some exceptions.
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