Medical emergencies happen, and even people with health insurance sometimes struggle to pay medical bills. If you don’t have enough in your emergency fund to cover expenses, you may be able to use a personal loan for your medical expenses.
Some lenders offer “medical loans” – these are typically personal loans that you can use to cover healthcare costs. Citi offers personal loans that you can use for almost anything, including medical expenses.
Let’s look at how personal loans work and when they can make sense as a financing option for medical expenses.
How to apply for a personal loan
Applying for a personal loan is fairly straightforward. You can typically apply online or in person at a financial institution.
You’ll fill out the application and provide relevant documents, such as paystubs, a government ID and proof of address. Many lenders, like Citi, can tell you if you’re approved right away. Citi accountholders can get funds deposited the same day in their Citi accounts, and non-Citi accountholders can get funds deposited via direct deposit within two business days.
Who can apply?
Every lender will have their own eligibility criteria that includes income, credit score, debt-to-income ratio and age. For example, to apply for a Citi personal loan you must be at least 18 years old and have a yearly income of at least $10,500. You'll need to meet Citi’s creditworthiness criteria and have valid proof of your age, income and address to be considered for a personal loan.
Advantages of a personal loan for medical financing
Using a personal loan to pay for medical expenses has several advantages, including fixed monthly payments and the ability to access funds quickly.
A personal loan can be a quick and easy way to access the funds you need. Many personal loan applications are processed the same day – Citi processes applications within 60 seconds – and, if approved, the funds are usually deposited soon after that. With quick access to funds, you don’t have to worry about when you’ll be able to pay for medical expenses.
Fixed monthly payments
Personal loans are usually fixed-rate, allowing you to pay back the amount in consistent monthly installments that don’t change over the life of the loan. They can be a lower-cost choice compared to options like credit cards, which typically come with a higher interest rate.
Disadvantages of a personal loan for medical financing
It’s important to consider all factors before deciding on a loan, including interest rate and credit requirements.
As with most loans, personal loans incur interest. And, because personal loans are unsecured, they can come with higher interest rates than secured options like home equity loans.
Personal loan interest rates depend in part on your creditworthiness. A relatively low credit score may mean you’ll have to pay a higher interest rate, and a score that doesn’t meet the lender’s requirements can mean you won’t be approved at all. You may not be able to secure a personal loan or may have to seek out loans tailored to people with lower credit scores, which can come with higher interest rates.
When to consider a personal loan for medical financing
A personal loan is worth considering when you have good credit and aren’t already in a lot of debt. Good credit will usually allow you to secure a loan, and a higher credit score can lead to lower interest rates. Less existing debt also means your debt-to-income ratio is low, and lenders may see you as a more responsible borrower.
You can use a personal loan in almost any way you want, so it can be a good option if you have multiple medical expenses. For example, for a knee injury, you might need surgery, medication and physical therapy to fully recover.
Citi offers personal loans to both existing Citi customers and new Citi customers that meet specific eligibility criteria, including an established credit and income history along with additional factors determined by Citi. If you think you could benefit from a Citi Personal Loan, apply online today.
Disclosure: This article is for educational purposes. It is not intended to provide legal, investment, or financial advice and is not a substitute for professional advice. It does not indicate the availability of any Citi product or service. For advice about your specific circumstances, you should consult a qualified professional.