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    Paying For Treatment: Medical Loans Vs Credit Cards

    Medical Loans vs Credit Cards

    More than 30% of working-age Americans have medical debts - and 28% of outstanding debts exceed $10,000.

    There are two main ways to pay for your medical bills other than cash: medical loans and credit cards. Each of these options come with their share of benefits and disadvantages which you’ll want to consider before applying. Let’s take a look at them in more detail to help you make the best possible decision. 

    Pros Versus Cons Of Using A Credit Card      

    Credit cards are an extremely popular form of lending. Here are some of the upsides and downsides of financing your medical expenses using a card. 


    • Interest-free introductory period. Many cards come with a 0% APR during the first year or 18 months. You can take advantage of this time to pay down your medical debts in full 
    • The ability to carry balances. You can opt to carry it over to the next month and only make the minimum monthly payment that’s due
    • Cash back rewards and other benefits. In addition to an interest-free initial period, you’ll also receive a certain percentage of your purchases back in the form of flyer miles, cash back rewards, and other perks on some credit cards


    • High APRs on some cards. After your introductory period ends your APR will increase - and you’ll want to check exactly what your regular interest rate and annual fee will be ahead of time
    • Carrying debt continuously. While it’s convenient to be able to roll your balance over to the next month, this also means that you could end up not paying down your medical debts 

    How To Use A Credit Card  

    If you choose to finance your medical bills using a card you’ll want to use this lending type to your full advantage. Here are some tips to keep in mind. 

    • Know your card type. A medical credit card can only be used for healthcare expenses while a regular card can be used for any purchase
    • Take advantage of your introductory period. As mentioned above, you’ll have a period of several months - or even more than a year - to pay down your debts interest-free
    • Keep your balances low and pay on time. You’ll want to keep your outstanding balance at less than 30% of your available balance and make your monthly payments on time to protect your credit score 

    Pros Versus Cons of Using A Loan   

    A medical loan - which is a type of personal loan - is another popular source of funds that you can use to settle your medical debts. Here are some of the advantages and disadvantages of applying for one. 


    • Fast access to substantial loan amounts. Medical loans range from $2000 to over $10,000 depending on the lender - and some loan providers offer same day approval 
    • Options for bad credit borrowers. Many lenders are willing to extend loans to customers with FICO scores below 680 provided that their employment and income situation is stable
    • The ability to pay down your debt once and for all. Your loan will be structured so that you repay it in full by the end of the loan term


    • High APRs on some loans. If your credit score is low, you’re likely to pay more interest and possibly higher fees on your medical loan 
    • The cost of monthly installments. Medical loans for large amounts may come with substantial monthly installments - especially if the loan term is shorter 

    Getting A Loan

    Applying for a medical loan is simple - in fact you can usually complete the entire procedure online. Here’s what you’ll need to do. 

    • Research your options. Loan reviews are a great source of information that will help you decide which loan is right for you
    • Apply online. You’ll need to provide the lender with your personal information, employment details, and copies of your recent bank statements. You can view the full list of requirements on its website 
    • Receive your lending decision. Some loan providers will be able to give you a decision on the same day - or even within an hour or two
    • Pay your installments on time. Once you’ve used your loan to settle your medical bills, you’ll need to make your payments on time to keep your FICO score high 

    What Are The Alternatives?              

    If you’re unable to obtain a loan or credit card there are still several options you can explore to settle your medical debts. 

    • Arrange a payment plan. Many healthcare providers will let you pay off your debts over a period of months 
    • Reach out to friends and family. You may be able to borrow enough money to pay down smaller medical bills by asking your family and close friends for a short term loan


    Medical debts are becoming an increasing burden on American families - and you can easily settle yours by using a medical loan or credit card. 

    While a loan offers the simplicity of fixed installments, a credit card gives you flexibility and the chance to earn rewards. Still, the easy application process and quick approval time that come with medical loans make them an ideal source of funding for the repayment of medical expenses.