The Real Cost of Applying to Residencies

Applying for residency programs can be extremely expensive and the costs can very quickly add up. Even if you’re highly qualified, you won’t be earning very much during your residency and chances are you also have medical school debt to worry about.

If this sounds like you, don’t worry. You can apply for medical residency loans to help out with your finances until you get your career on track.

Keep reading to learn all about residency loans and how they can keep you afloat during your residency!

The Cost of Applying for Residency

Many aspiring doctors don’t realize just how much apply for residency can cost. There are fees for two items: the Electronic Residency Application Service (ERAS) and the National Residency Matching Program (NRMP).

There is a wide range in which the total cost of applying for residency can fall. There are a number of factors that influence the total cost, such as which specialty or specialties and applicant is looking to study, how many applications are submitted, how the programs are ranked. Where an applicant lives in relation to a residency can also affect the overall cost of the application process.

Application Fees

While not able to be fully known upfront, the applications fees are easier to project in advance. For example, it’s possible to calculate the cost of applying for a single medical student with only one specialty:

• Applying to 10 schools = ~$260
• Applying to 40 schools and ranking 20 programs = ~$820
• Applying to 80 schools and ranking 25 programs = ~$2000

The Cost of ERAS

ERAS is a centralized online application service future residents use to deliver their applications and supporting documents when applying to residency programs.

ERAS have different costs, depending on how many applications are completed per specialty:

So, for example, an applicant who is applying to 30 programs with one specialty will pay:

$99 + (10 x $14) + (10 x $18) = $419

In this scenario, the applicant is paying $99 for the first 10 applications, $140 (10 x $14) for applications 11-20, and $180 (10 x $18) for the last 10 applications.

For an applicant applying to 30 programs with two specialties, the breakdown will look similar to this:

$99 + (10 x $14) + $99 = $338

Here, the applicant is paying $99 for applications 1-10 with one specialty, $140 (10 x $14) for applications 11-21 with that same specialty, and $99 for 10 applications for a second specialty.

At this point, it should be clear just how quickly the applications costs for ERAS can add up, especially for applicants applying to many schools and with more than one specialty in mind.

The Cost of NRMP

The National Resident Matching Program is a not-for-profit, private organization that helps to bridge that gap between medical students and graduates and medical training programs in the U.S.

NRMP has a standard registration fee of $85 per program for the first 20 ranked programs. For additional programs beyond that initial 20, the fee is $30 per program.

Interview Expenses

So, while ERAS and NRPM fees are possible to calculate, there are additional, variable costs and these costs tend to make up the bulk of the cost of applying for residencies.

Depending on where an applicant lives and where the programs he or she is applying to are located geographically, the interview expenses can add up very quickly.

In many cases, to attend a residency interview, an applicant must at least cover the cost of travel to the interview and costs of a hotel stay for the duration. If the interview is within driving distance, this can cost a couple hundred dollars. If a flight is required, it can cost much more.

For the sake of illustrating how costly attending interviews can be, let’s look at a breakdown.

Let’s say that the average roundtrip flight costs $300 and the average cost of a hotel room for a single night is $100. For an applicant who is attending 10 residency interviews, the breakdown looks like this:

($300 + $100) x 10 interviews = $4000

That’s a lot of money for just 10 interviews. What’s more, those figures are below the national average costs for airfare and hotel stays:

• Airfare National Average: $349.71
• Hotel Stay National Average $126.42.
• Average Total Cost Per Interview: $476.13

So, for 10 interviews, the average cost is actually $4,761.30

And bear in mind that these are just the averages. Flights get more expensive the further you have to fly. Similarly, some residency interviews may be in more metropolitan (read: more expensive) areas and may require more than a single night’s stay. It’s important to recognize that, in most cases, the national average costs for airfare and hotels will be the low end of what you need to pay to attend your interviews.

It’s also important to remember that your probably won’t be attending just 10 interviews and that these costs are in addition to the application costs discussed above.

What is a Residency Loan?

Medical residency loans are loans for doctors in residency. You take out a medical residency loan to help cover your living expenses while doing your residency.

You can also use a residency loan to help cover the cost of applying for residency programs such as travel cost, interview cost, board examination fees, and relocation costs. These costs aren’t covered by your student loan, so having to cover it yourself can be tough on your budget.

A residency loan is essentially a private personal loan. This means you take out the loan from a private lender such as a bank, credit union, or online lender. The rates, fees, and terms you  get on a personal loan will be determined differently by each lender but typically using a combination of the following factors:

• Credit score
• Credit history
• Income
• Debt-to-income ratio
• Employment history
• Financial behavior
• Residency status

For personal loans, you can expect rates between 5% and 20% on loan amounts that vary from $1,000 to $100,000.

Interested in medical residency loans? Let’s look at how you can apply for one.

How to Apply for a Residency Loan

Applying for a residency loan is easy. Just follow these four simple steps.

1. Research different lenders

There are many different lenders out there who offer personal loans. Not all lenders will suit your specific needs and circumstances, and you probably won’t qualify for all the residency loans available.

For example, if you are an international student or visa holder, you won’t be able to apply to all lenders. Some lenders don’t offer loans to visa holders or immigrants, and some require you to apply with a cosigner who is a U.S. citizen or permanent resident. Some might even charge you exorbitant fees to set off the additional “risk.” Only a few lenders offer loans with competitive rates and terms to visa holders and immigrants without requiring a cosigner.

So it is important to do your homework to find the best lenders whose eligibility requirements you meet and those who suit your specific circumstances.

2. Compare your options

Once you’ve found a few lenders you can work with, don’t just take the first best loan you get offered! It is important to compare different loan offers and their rates and terms to make sure you get the best deal.

Most lenders have a soft credit pull or pre-approval option. With this option, you can fill in your basic details (without doing a hard credit check) and get a preliminary loan offer. This will give you a better idea of exactly what the lender will offer you and help you better compare different loan offers. Make sure you get the best possible offer available to you!

3. Apply

Now that you know you’ve got the best deal you can go ahead and apply. Many private lenders give you the option to apply online. This process makes applying quick and easy.

You’ll probably need some of the following documents when you apply, so make sure you have them ready:

• Proof of identification
• Proof of income
• Proof of address
• Proof of employment
• Proof of residency status or visa documents

4. Get approved and receive the funds

After applying, the only thing left to do is wait. If you apply online you’ll probably get notified quite quickly whether you are formally approved. Once you are approved the funds will be disbursed to you (which means it is paid out). Most private lenders disburse the funds between one day and one week.

3 Major Benefits of a Residency Loan

There are great benefits to taking out loans for doctors in residency. Here are our top three benefits.

1. Availability

There is a wide range of lenders out there who offer residency loans. This is good news as it means you most likely won’t struggle to get a residency loan. As we explained above, you just need to find the right loan that suits your specific needs.

2. Flexibility

Because there are so many residency loans available, you’ll have plenty of options. You have the power to find the loan and lender that works best for you. This is also why doing your research is important. If you don’t know the different options out there you’ll never know if you got the best deal.

3. Covers the Cost of Applying to Residency Programs

There’s no point in talking around it. Applying for residency programs is really expensive! Not only do you have to travel to different locations (or states!) for interviews, but there are application fees involved as well.

In 2017, the cost for the Electronic Residency Application Service was between $11 and $26 per application (the more you apply for, the cheaper it gets). On top of your application fee, you also need to pay for transcripts for each application. This costs about $80 per transcript.

To put it another way, doing 36 residency applications would cost you $2,880! And this does not even include the travel and accommodation costs for interviews. One doctor writes it cost him over $9,600 to apply for 24 residency programs, 80% of which was travel costs.

Clearly, this can put quite a lot of pressure on your finances, but you don’t have to worry. Taking out a residency loan can help ease this pressure. You’ll be able to apply to as many residency programs as you want so you don’t miss that golden opportunity.

Conclusion

Don’t let the burden of applying for residency programs, paying off your student debt, or doing your residency on a tight budget get you down. Apply for a medical residency loan to help ease the cash flow so you can focus on becoming the best possible doctor you can be.

Frank Gogol

I’m a firm believer that information is the key to financial freedom. On the Stilt Blog, I write about the complex topics — like finance, immigration, and technology — to help immigrants make the most of their lives in the U.S. Our content and brand have been featured in Forbes, TechCrunch, VentureBeat, and more.

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