Why are banks more willing to lend to a medical student than a student in a vocational college?

Answer 1

The med student has higher potential future earnings and is therefore more capable of future repayment.

Answer 2

A medical person has more invested. Chances are greater they will do their trade and have a stronger ability to repay. A trade school? How nice, financing a blue collar worker. If you don't find a trade job then easier for you to walk away and find something else.

Banks determine risk of investment. Which is the lower risk?(Not the cash amount, the "RISK FACTOR") Banks are in business to make money. A small loan with a high risk?

Go figure/// it is not a moral question, it is a financial business decission.

Answer 3

Because the doctors eventually make more money and have more ability to repay the loans.

Also, because there are a few vo-tech colleges out there that do a shoddy job training people, and then they can't actually find the jobs that they were trained for. The lenders figured this out, so they're more wary of lending to vo-tech schools now, because they're not always sure which are good at placing their students and which ones aren't.

Answer 4

It's a matter of simple economics, really. Docs will make more than welders for the most part, so it's a safer loan for the bank to make.

Of course, when you look at statistics, doctors and the highly educated professionals tend to be the biggest defaulters on student loans too, likely because of how much they have to borrow to finish their education.

It seems silly knowing all of the facts, but most humans aren't entirely rational or thorough in their decision making. Humans, in fact, are proven to make decisions first and then make up a rationale for that decision afterwards. Scott Adams (Dilbert's creator) has done some fascinating writing on the subject.

Answer 5

As a physician, a medical student has the potential to make a generous salary, and have the ability to repay the loan in a timely manner and not default on the loan.

Answer 6

The fact You highlight on Your question is such a dumb sociological issue...

Doctor have a tendency to become wealthy, whilst vocational advisors don't...

A Doctor full degree and specialization may easily take up to ten years of their life : They Invest MUCH, therefore, Their profit is higher, and their Creditors tend to cash more frequently and at a higher rate...

See ? Just a matter of Risk / Payback...

Good luck! Bear hugs! ;-)

Answer 7

Because, logically, Medical students will have a higher income upon graduating and therefore will have an easier time repaying the loan.

Answer 8

Maybe because Med school costs more and the lender can milk them for more, longer.