Summary of Medical Loans for Health Care Expenses
|Lender||Est. APR||Min. Credit Score||Learn More|
9.95 - 35.99%
4.99 - 16.79%
5.99 - 18.64%
6.18 - 35.99%
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10.68 - 35.89%
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Compare medical loans
Here are some key factors to consider when shopping for medical loans.
Annual percentage rate. A loan’s APR represents the true annual cost of borrowing, including interest and fees, helping you make an apples-to-apples cost comparison between loans. APRs on personal loans range from 6% to 36%. You’ll need strong credit to get the lowest rates.
Fixed or variable rates. The loan’s rate can either be fixed (interest costs and payments stay the same), or variable (interest costs and payments can rise or fall, depending on market rates). A fixed-rate loan comes with peace of mind that your payments won’t rise over the loan term.
Origination fee. Some lenders charge one-time origination fees to cover the cost of processing the loan. The fee typically ranges from 1% to 6% and is included in the APR calculation.
Most lenders subtract the origination fee from the loan proceeds; a $10,000 loan with a 3% origination fee would cost $300, leaving you with $9,700.
Loan term. The repayment period length affects your monthly payments. A longer repayment term results in lower monthly payments, but higher total interest paid over the life of the loan. Aim for a loan term with payments that fit within your budget. Use our personal loan calculator to see estimated payments at different loan terms.
Speed. If you need fast funding to cover medical expenses, consider a lender with a quick application to funding process. Some online lenders can provide funding within a day or two, while others can provide funding within a week.
How to pre-qualify for a medical loan
Pre-qualifying for a medical loan with an online lender lets you see potential loan terms, including the loan’s interest rate, loan amount and payments. Take the steps to pre-qualify and compare offers to find the loan that gives you an amount you need and a payment you can afford.
Alternatives to medical loans
There may be better ways to finance a medical procedure or pay medical debt than through a personal loan.
Payment plans. Your best option may be to establish a payment plan with the medical provider and avoid paying interest on the debt if it’s repaid within the term, says Kari Jean Glosser, a financial advisor and partner at Abacus Wealth Partners in Santa Monica, California.
Some health care providers require a deposit followed by monthly payments; others may accept just monthly payments until the debt is repaid in full, says Glosser, who used a payment plan for her own dental surgery.
Ask your medical provider about any fees or charges associated with the payment plan, so you know the full cost of this option.
Medical credit cards. These are specialty credit cards available through many medical providers.
CareCredit is a specialty credit card that offers a short-term financing option at 0% interest if paid in full by the end of the term (6, 12, 18 or 24 months). For longer terms, the APR depends on the purchase amount and term length.
The card, issued through Synchrony bank, is accepted at over 200,000 health care providers. CareCredit’s approval and terms are based on your credit, and not all medical providers offer promotional financing options.
» MORE: 3 medical debt mistakes to avoid
0% credit card. A 0% interest credit card is another option that can include a sign-up bonus and rewards. You’ll need strong credit to qualify, and you must pay off the debt in full before the promotional period expires or you'll pay high interest charges.
It’s best to dedicate a regular credit card for medical expenses only. Mixing medical debt with other purchases makes it harder to keep records for tax deductions or a health savings account, Glosser says.
Other options. If you’re facing hospital bills, a medical bill advocate can help spot potential errors and negotiate on your behalf to have your total bill reduced. Some medical providers may also offer hardship plans for low-income borrowers.
» MORE: Ways to pay medical debt
Last updated on March 26, 2020