Trying to negotiate a group rate for RBC LOC?

[davidubc]

If you have been accepted to UBC set up an appointment with the bank.

Bring your acceptance letter. The Royal Bank of Canada has a special program only for medical students who are attending a medical school in Canada.

No banking fees which means no monthly fee, no money order or traveller check fees etc!

I just got a line of credit for 160K at prime as well.




I edited the title, and will move this thread out of the UBC forum into the Med School Orientation 101 forum. Hopefully, this may give you an increased audience for those people currently looking to try to negotiate for a prime - 1 interest rate on your LOC! -Ian

[kanayo101]

I was just on their website browsing and found a scholarship all you lucky ducks can apply for

www.rbcroyalbank.com/stud...rship.html (http://www.rbcroyalbank.com/student/medical/scholarship.html)

[physiology]

Here's the MD Management/National bank of Canada -
doesn't look as good as the RBC one.

mdm.ca/content/md/solutio...sident.pdf (http://mdm.ca/content/md/solutions/banking/pdf/Student-Resident.pdf)

Just a thought, couldn't a few of us from this forum band together and offer the banks our business, provided that they give us prime minus 0.5% (like Desjardins in Quebec) and significant reduction or elimination of the life insurance fees?

I mean, let's say, twenty of us decided to go through RBC, and all at the same branch, wouldn't this be very attractive?

Anyway, I'm just looking to save some money!

[Kirsteen]

Hi there physiology,

I mean, let's say, twenty of us decided to go through RBC, and all at the same branch, wouldn't this be very attractive? This is a great idea, and one which the banks may have a very tough time passing up. In fact, if you do manage to round up 20 students, I'd start the negotiations at prime minus 1.0% and aim for no less than prime minus 0.75%. After all, you're saving them legwork by bringing a horde of very attractive, debt-needy folks, and given that Desjardins are offering prime minus 0.5%, from RBC's point of view, i.e., explaining the situation to a regional bank manager, it would be reasonable to have to offer the extra 0.25% to lure you away from the competitors. :)

Is anyone willing to join in on an RBC LOC coalition in the Toronto area (since LOCs are completely transferrable and it should not make too much, if any, difference where you actually end up going to school in September)? :)

Cheers,
Kirsteen

[ubcpharmer]

Physiology i would be definately interested. I have sent you a message in your ezinbox

[Kels2004]

Hi guys,
Great idea... I would like to be involved, although I am currently in England. Will they set up an LOC from afar if we fax in info, or do we have to be physically present? I finish work here mid July, so planned to set up the LOC when i return to Alberta then.

Keep us posted on the negotiations!

Kels

[lex]

I'd definitely be interested in doing this. I'm assuming that most of us are in BC?

The rep that handles this in Vancouver is George Tsonis
(604) 668-4300 Broadway & Cambie Branch
george.tsonis@rbc.com

I write this because it may be useful to set something like this up at home to establish a working relationship with the rep.

I believe that it already made its way to this area but bc's loc chart is:

www.med.ubc.ca/md/financi...ce/LOC.htm (http://www.med.ubc.ca/md/financialAssistance/LOC.htm)

It's also in the financial planning book that came with the UBC package.

[sehender]

Hey Guys,

I am in the Vancouver area and I would be happy to join the group of people planning on gathering together to apply for a LOC that is below prime.

I went and talked to Rosemary McCruchton (I think that's how you spell it), the financial advisor for UBC students. She said to apply for a LOC later on in the summer when we have official statements declaring that we are UBC medical students (the official statements will be coming in our registration packages).

Would anyone else like to join us? I guess we'll need about 20 like the others have suggested...

[Miller]

I sent you a message physiology. I think getting together as a group is a great idea. As I mentioned in the message, the more students we have the more leverage we can use. So it would be worth trying to contact UBC and see if they would be willing to send out an email to the incoming class. It could only help us all so why wouldn't they do it.

[Ian Wong]

I'll move this thread out of the UBC forum into the Med School Orientation 101 forum. Hopefully, this may give you an increased audience for those people currently looking to try to negotiate for a prime - 1 interest rate on your LOC!

Good luck! This would be a sweet deal if you guys could make it happen. :)

Ian

[physiology]

Hello Everyone,

Thanks for all the support! I've gotten private messages from some of you.

I was thinking I would ask the financial services planner who works for the faculty (as per Miller's suggestion) and ask her to help in coordinating this.

In light of my age and inexperience in financial matters, I'm sure she has more credibility than me, unless all 200 of us were willing to show up at one RBC branch (with pickets, threats of hunger strikes, and bullhorns?..haha)

Another great idea was emailing this suggestion to all 200 of us to reinforce the "strength in numbers" concept. We also have interested people from other Canadian med schools (ie Kirsteen). By the way, thanks for the great tips Kirsteen. This is great!

So I'm going to start with the finance worker by calling her ASAP on Monday.

I'll keep you posted.

[4EverRose]

Great idea physiology. Count me in too!

I know Rosemary McCutcheon from UBC Med is going to host a financial assistance seminar on June 15, from 5 to 6 pm at B Hall, 2773 Heather St. (next week she is going to send an notification to those got accepted about this) How about we bring this up during the seminar?

[Novoulmi]

Hey physiology

I'm currently in victoria, and will be attending the island program. I'm really interested in this group rate dealy-o and was wondering if it will be feasable for those not situated in Van City to get in on this. If it seem possible, count me in.

Novo

[Ciara]

Hi there -

I think this is a great idea! I'm in Toronto right now, but my parents are in Vancouver so I guess either spot works for me.

Has anyone approached credit unions about med student LOC's - like Vancity in BC or Metro Credit Union out here? Because I think Desjardins is a credit union. (Although I'm not actually sure how they are different from a regular bank..) Well - maybe I'll check some out and report back. But count me in!

Ciara

[physiology]

I just talked to Rosemary McCutcheon. There's bad news on the horizon.

Unfortunately, these LOCs have been negotiated by the Canadian Federation of Medical Students (CFMS) and thus, they have made a lot of leeway in terms of perks and benefits.

Because individual bank managers and even branches themselves do NOT have the power to change interest rates, all requests would have to go through head office. Furthermore, most managers won't even bother sending requests to the head office unless they're reasonable.

As such, a prime-1% is a long-shot and any changes to these LOCs would have to be negotiated through CFMS and would be at least a year in the making.

In terms of life insurance, banks may be willing to scrap that if you have guarantor.

I talked about the "strength in numbers" we may have and still, that would be insufficient in getting the banks to budge.

I've also contacted two credit unions, Coast Capital Savings to no avail and currently waiting on a call-back from Van City.

So with what we have now, I think RBC or MD Management is the way to go. Which appeals to people more?

BTW, Rosemary McCutcheon is organizing a seminar on our behalf. The office is supposed to send it out this week but here are the preliminary details:

June 15th - 5-6 pm at the VGH B-Hall.

This is the SAME stuffy, incommodious location in which we had our orientation.

Anyway, that's the gist of it. I asked her to bring this up at the seminar as well.

[Kirsteen]

Hi there,

Great work, physiology! :)

Because individual bank managers and even branches themselves do NOT have the power to change interest rates, all requests would have to go through head office. Furthermore, most managers won't even bother sending requests to the head office unless they're reasonable. Unless something has changed drastically, bank managers have a good deal of latitude in offering lower interest rates. I guess the key is how each manager defines, "reasonable". :)

Cheers,
Kirsteen

[lex]

A couple of posters in the dental students forum mentioned that they were able to negotiate a payment interest rate (when the LOC gets converted into a personal loan) of prime. Others stated that they would be paying above prime after the prime accrual rate during dental school. Like those for med students, these LOC's would have likely been negotiated by a student's federation as the programs are offered institutionally.

I noticed that the rate during the payment period is not listed on the UBC LOC summary sheet. So, maybe this was not included in the initial negotiation? If so, this could be an area to exploit.

[Guyver03]

these LOC's would have likely been negotiated by a student's federation as the programs are offered institutionally.

Well Lex, I'm not sure if you mean that dental students have to rely on student's federation to bargain for prime rate after gradutaion instead of prime + some %. But I just called Scotia bank and told them I'm starting dental school, and they immediately said I would get prime rate during school and after graduation, no conditions.

[physiology]

Hello Everyone,

After I told Vancity I didn't own a home, the conversation pretty much went downhill :)

Anyway, don't bother with Vancity.

[lex]

I wasn't saying that dental students had to rely on a students advocacy group for prime +0% after grad, just the opposite. Some dental students were getting it and some weren't. Thus, I assumed that the dental LOC's were prenegotiated (as with med students) but, because of the discrepancy between LOC applicants, that the loan conversion was not.

Additionally post-grad loan rates weren't specifically listed on the med line-of-credit summary sheet handed out by UBC so I was wondering whether post-grad rates vary across lending institutions.

[Guyver03]

Hey Lex, some banks do have different post-grad rate, like BMO has a prime + 0.5% on their website, but I'm sure that's negotiable. I think depump, another starting dental student from Calgary, actually got prime + 0.5% on both pre and post-grad from Scotia bank, whereas I got prime on both pre and post-grad from Scotia bank here in Vancouver. I guess the thing is to push for prime + 0%, use other banks' offers as leverage. Of course for Scotia bank, you have to pay a monthly fee of $3 for the bank account, while RBC, I think, doesn't charge that. Check out the dental forum if you have time.

[lex]

Yeah, CIBC's goes up to prime +1% after PGY1. Makes a significant difference. So, anyone who didn't get it should think about going back into to renegotiate. You can always switch banks.

[physiology]

So, it's final. I met with George Tsonis at the Royal Bank, and it's firm, that there's NO leeway on the prime rate.

Apparently, he recognized me as the ring leader and asked if I was the one that had started all this discussion on negotiating for less than prime. I was slightly embarrassed :o

Anyway, right now, prime is at 3.75%. However, prime interest rates are set by the Bank of Canada and depend on the economy. George pulled up these scary files that showed prime was 18% in the early 80s. Lots of people lost their houses due to the insane mortgage payments!

I had life insurance tacked on because I don't want to put up my parents as co-signers. It's 12 cents/$1000 borrowed. What else...I get a Student Price Card (remember those from high school?), 12 free bank drafts, an account with 25 free transactions and no minimum balance or monthly fee.

They also give you this neat CD with all this scholarship info. However, under the UBC section, only ONE scholarship is offered! Anyway, I think the UBC awards are given out by the office and individual applications are not required.

It's prime during residency and probably fellowship. Although fellowship has to be negotiated on a case by case basis. I even gave him the example of "What if I decide to go into pediatric neurosurgery, which would be 4 years of med school, 6 years residency, and 1-2 years of fellowship? (11-12 years total)?" He still said that you could probably expect repayment a year following the fellowship and interest would be at prime.

Fellowship is a continuation of the education process and therefore is treated like residency.

Basically, he mentioned that the loan is "too good to be true" because they want to keep us as loyal customers in the future due to our potentially high income and the fact that we may need RBC for business loans to buy equipment or start up our own practices.

By the way, they can recall the LOC if you fail to pay the interest, go bankrupt/insolvent, or if the bank goes bellyup.

If you have any questions, feel free to private me or post here.

[lex]

Just a word of advice. It doesn't matter what is claimed if it isn't in writing. It's nice that the rule of thumb is prime, but really, an oral statement means absolutely nothing 9 years from now when it really matters.

Physiol - the 80's were indeed pretty crazy. I know some people that had mortgages as high as 21.5%. Pretty crippling.

L

[DonaldKaufman]

Physiology,

Can you get life insurance with a private company instead of RBC, and still not have to use a co-signer?
Is the 3.75% a floating rate, or is it 'locked in' at that rate for the length of your LOC?
Can you symbolically hand back the Student "Value" Card ? (they're just an advertising ploy used to increase a company's market share and profit margin - if they didn't do that, they wouldn't offer them)
;)

The RBC LOC sounds like a pretty good deal though!
Thanks for doing all of this legwork, and thanls for posting all of this info in the forum.

-DK

[physiology]

Hello Lex,

Yes, I realized during our discussions that it was just an oral agreement. However, I'll check my agreement later. I just realized how quickly he rushed me through it. You feel pressure to NOT read it thoroughly.

Anyway, there was no agreement that I could sign that said "your interest payments will be at prime during residency/fellowship." George just stated that residency would be at prime, but fellowship would be negotiated on a case by case basis.

I can tell he's VERY knowledgeable about the medical field. He's dealt with a lot of customers. In fact, he was telling me of this pediatric neurosurgeon who just finished residency and went down to the States.

So perhaps getting prime is dependent on getting into a high-income fellowship? (Pediatric gastroenterology as opposed to as family medicine?) These are all speculations. But remember, banks are incredibly astute and really know how to make money.

Donald Kaufman,

Prime is set by Allan Greenspan, I mean the Bank of Canada ;) So prime this month is 3.75% but next month it could be higher. It depends on the eocnomy. Theoretically, if we hit a recession era in the next few years, it could go up to 18% like it did before in the early 80s. However, from the looks of it, it doesn't APPEAR to be going that way. But give Bush a few more years in power, and who knows...but I digress...

As far as I know, they will NOT give you a fixed rate.

Regarding getting private life insurance, he said something about how I'm getting a good deal paying 12 cents/$1000 and that I wouldn't get this rate at such a young age, and blah blah blah...I didn't really get it. Thus, I never really had the chance to ask about other sources of life insurance.

That's a good question though.

[lex]

There was a post a little while by Kisteen: she mentioned that third party life insurance was available and may make better economic sense.

To echo Physiology, prime's at 3.75 but this rate is historically low, so a raise in interest rates would shouldn't surprise anyone. There have been murmors about it lately but as of yet, no movement.

I too was wondering whether choice of specialty/fellowship willl affect bargaining power when it comes time to begin payment.

The best advise would come from those who have gone through the process. Anyone like that out there? Maybe this should be posted somewhere else. Ian, if you're listening, any advise on this? Thanks.

Edit: I posted the question in the general resident physician discussion page. Hopefully somone will bite.

[ubcpharmer]

Getting private life insurance is an option that the bank is willing to accept as long as the insurance will cover the outstanding liability. I was speaking with an family friend who owns a insurance brokerage in in ontario and it was his opinion that 12 cents/1000 was a good deal when the liability is low but may not be so good when we borrow close to the maximum amount. you have to remeber that we are young healthy individuals and thus the premiums for a $200000-300000 life insurance would be very low. If people are interested, I can speak to him in particular aabout rates and possibilty of group deals

[Nikhila]

I went into an RBC branch in Ottawa a couple of weeks ago and got the paperwork started on my LOC and opening an account there. However I was told that they would need proof that I was enrolled before I could actually get my SP card and the LOC itself. Has anyone actually got all the administrative stuff out of the way so that they have access to their LOC right now? Or are you waiting like myself?

Thanks,
Nikhila

[Kirsteen]

Hi there,

The Toronto RBC folks were satisfied simply by taking a copy of my acceptance letter. At this point, my LOC has been approved and the documents are in my Toronto mailbox waiting to be signed and returned. The RBC rep has assured me that, once received, the LOC should be active within 2-3 days, i.e., next week.

Maybe you can ask your RBC representative to chat with the Toronto-area representative to try to align their policies? :rolleyes

Cheers,
Kirsteen

[dr deelish]

I had the same problem .. I've been approved for an LOC, but without showing proof of registration (or a confirmation of registration from UT) I don't have access to the LOC. I had my LOC-business done at the Toronto branch .. so maybe this is just RBC policy ... ?

[soapyslicer]

Hi Everyone,

I finally went with the RBC LOC. Even once you sign on the line and they tell you it is all set, it does not show up on your account until your school signs a special form and faxes it back to them. Some school may 'group' register sooner than others hence the ability to access the funds. UBC does not register before the end of July so I was in a bind. I specifically asked then to open it sooner and they granted my request however they only approved 70,000 until I am officially registered. This was in large part that I needed to move my family to Prince George in the next few weeks as well as buy a house.

soapy

[walton1]

Hi folks,

Noticed that RBC seems to require life insurance (is this always the case?). Anyway, at BMO the life insurance is not compulsory, although they did try to talk me into getting it. Their line was "so your estate won't be stuck with the debt," yeah right!! No point in life insurance unless you have dependents (or I suppose if your bank requires it to be held).


wally

[shrinkage]

Wow...

Sorry to confuse you guys even further...

I got my LOC approved at RBC a few weeks ago, and as far as I know, everything is Kosher...I got my access card, etc., (I didn't have an account previously), and I saw my LOC balance on the ATM and everything. I'll try to do a withdrawal (I haven't needed to yet) to make sure that the money is actually "there", but I'm pretty sure that it is...

Also, the lady I dealt with gave me a way more expensive and different rate for the life insurance (something like $0.90 per $1000 borrowed, which she assured me was a completely separate deal from the LOC)...I've since figured out that I can cover myself for about a quarter mil, for something like $20/mth using the "Alumni Manulife" service available to most Ontario university grads (check with your school to see if this is offered if you are interested).

Anywho...it is weird and scary that these huge differences exist...

[shrinkage]

Okay, I just checked (I've enrolled for on-line banking).

All LOC funds accounted for...

I guess it doesn't REALLY matter whether you get access to the cash now or in a month or two, though, right? Realistically, you don't NEED the cash until the tuition statement is sent to you.

Anywho, just thought I'd update you guys...
>:

[Kirsteen]

Hi there,

As a bit of an update: my RBC LOC was approved the week before last, I received the paperwork to sign off late last week, and returned it to the branch this week. The LOC became visible in my on-line banking accounts today and I now have access to the full balance. Incidentally, in case this is of use to anyone, once you are approved and your signed forms are received, RBC are willing to transfer funds (~$10,000) for your use prior to the LOC become officially active.

Cheers,
Kirsteen

[shrinkage]

Hi guys (and gals),

I just wanted to say that I have no idea how that "mad face" suddenly appeared on my last post. I'm pretty sure it wasn't there originally. It probably seems kind of out of context given the neutral tone of my message.

Maybe this is a problem with the forum software?

[gobluebaby]

Hey All,

I am about to sign my papers for an RBC LOC, but I am concerned that they are only making available 30,000$ right away. I thought the great benefit with RBC was that the amount / year was unlimited up to the total of 150K.

Anyone else have similar experiences ???

Thanks,

GoBlueBaby

[Kirsteen]

Hi there,

I've been dealing with the RBC at Dundas and University, here in Toronto and they've made the whole lot available if I'd like it. If you need huge, front-end flows of cash then you might wish to query the reason for their limit.

Cheers,
Kirsteen

[Nikhila]

I've been dealing with the RBC folks in Ottawa and they have made $80,000 available to me up front...

nikhila

[Nikhila]

I had life insurance tacked on because I don't want to put up my parents as co-signers. It's 12 cents/$1000 borrowed. What else...I get a Student Price Card (remember those from high school?), 12 free bank drafts, an account with 25 free transactions and no minimum balance or monthly fee.

For anyone who was confused about the discrepancy regarding life insurance costs with RBC (I read someone was quoted $0.90/$1000, I was quoted $0.50/$1000) the $0.12/$1000 is for people whose LOC amount is 100K or over

Nikhila :)

[Ian Wong]

Floating back to the top.

Ian