When health problems arise, you may be faced with a difficult choice between your health and your finances. Medical expenses contribute to a staggering 66.5% of personal bankruptcies in the U.S.
High medical costs, premiums, co-pays, deductibles, and annual or lifetime limits on coverages can leave patients with enormous medical debt even if they have health insurance. Worse yet, this debt occurs when their ability to work may be reduced by the very health issues that require treatment.
Medical loans may relieve this tension by allowing patients to borrow money to pay for medical treatment and living expenses while recovering.
What are medical loans?
A medical loan is a personal loan you take out to finance a necessary medical procedure, medical debt consolidation, elective procedure, or rehabilitation costs.
Borrowers with a good credit score may be eligible for medical loans that are not secured with collateral. A credit score of 740 or higher is considered very good or excellent. With an unsecured loan, you do not have to worry about losing your home or property because of medical debt.
On the other hand, borrowers who can secure medical loans with collateral or have another borrower co-sign the loan may:
- Qualify for funding with a lower credit score.
- Be eligible for a higher loan amount.
- Pay a lower interest rate.
How do medical loans work?
Borrowers can easily determine whether they qualify for medical loans and the terms of those loans by applying online or by phone. The application collects some basic information, such as your name, address, birth date, and social security number, so the lender and its affiliates can obtain a soft credit inquiry. This soft credit inquiry does not impact the applicant’s credit history.
Based on the application, the lender can narrow down the loan terms that it can offer the applicant. Those loan terms may depend on your income, credit score, debt to income ratio, state of residence, and, for secured loans, collateral.
Often, lenders can present borrowers with varying options for comparison. Since medical loans have a fixed interest rate and fixed duration, the size of the loan and interest rate will determine the amount of the monthly installment payment.
What are the benefits of medical loans?
- Fast approval: Most lenders can review a credit application and contact you within a day to discuss your funding options.
- No obligation: Applying for a medical loan allows a lender to offer you terms without obligation or impact to your credit score.
- Flexible: Medical loans vary in the amount, interest rate, and monthly payment terms offered to borrowers based on their finances.
- No restrictions: A medical loan can pay for a medical cost that health insurance may not cover, such as cosmetic surgery, weight loss procedure, experimental drug or therapy, and fertility treatment. Medical loan proceeds can also be used for living and travel expenses during treatment and recovery.
Should you get a medical loan?
A medical loan may be your best option for financing medical procedures and recovery costs in many circumstances including:
When you have no health insurance to cover medical expenses.
Health insurance companies often refuse to cover, or cover at a lower rate, any medical procedure they deem non-essential. Although the Affordable Care Act set some basic standards, health insurers make their own coverage decisions. Some may exclude procedures necessary for good mental and physical health such as reconstructive surgery after an accident or medical treatment, residential drug or alcohol treatment, and bariatric weight loss surgery.
Many health insurance companies deem fertility treatments, hair loss treatments, and medical cannabis to be elective and ineligible for coverage. This is true even if the procedure is necessitated by a covered medical procedure like chemotherapy.
Health insurers may exclude experimental medical treatment, such as experimental cancer drugs, from coverage even though it could be a cancer patient’s last resort for treatment.
Cosmetic treatment is usually not covered by health insurance. For example, if a car accident damaged your teeth and jaw, orthodontics might be covered by dental insurance. However, in about 85% of cases, the teeth or jaw are naturally misaligned and the insurer denies coverage by deeming the treatment to be purely cosmetic.
Prior medical debt
If you have prior medical debt, you can use medical loans to consolidate your medical debt into a single loan with fixed rates and fixed monthly payments.
Medical loans can be a lifeline
Being caught in a situation where you need medical treatment, but do not have the insurance or cash to pay for it, can leave you feeling trapped. Your medical problems may inhibit your ability to work, so earning enough money for the treatment or obtaining employer-sponsored health insurance may be impossible. You and your family still have living expenses, like rent and groceries, so you are at risk of mounting debt.
Acting quickly to obtain a medical loan can enable you to receive the medical treatment you need and get back to work. Used in this way, medical loans can save your health and your family’s finances.
Apply for a medical loan from Mariner Finance today! Visit our online form or call us at 877-310-2373 to begin the application process.
†We offer personal loans from $1,000 to $25,000, with loans terms from 12 to 60 months. Minimum and maximum amounts dependent on an applicant’s state of residence and the underwriting of the loan. Loans between $1,500 and $15,000 may be funded online. Loans greater than $15,000 or less than $1,500 are funded through our branch network. Specific interest rates and fees are determined as permitted under applicable state law and depend upon loan amount, term, and the applicant’s ability to meet our credit criteria, including, but not limited to, credit history, income, debt payment obligations, and other factors such as availability of collateral. Not all rates and loan amounts are available in all states. Additional fees may apply to some loan offers; some state required and/or permitted fees may be treated as prepaid finance charges. Any such charges shall be in addition to the loan amount requested and/or approved and shall be fully disclosed to the applicant on his/her loan agreement. Not all applicants will qualify for the lowest rates or larger loan amounts, which may require a first lien on a motor vehicle not more than ten years old titled in the applicant’s name with valid insurance. Our loan by phone and online closing process requires a compatible mobile or computer device on which you can access your email and electronic documents. Not all loan types are eligible for loan by phone or online loan closing.
To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account. As a result, under our customer identification program, we must ask for your name, street address, mailing address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver's license or other identifying documents.
*The process uses a “soft” credit inquiry to determine whether a loan offer is available, which does not impact your credit score. If you continue with the application process online and accept a loan offer, or are referred to a branch and continue your application there, we will pull your credit report and credit score again using a “hard” credit inquiry. This “hard” credit inquiry may impact your credit score.