Bariatric Weight Loss Surgery Financing for Bad Credit

Bariatric surgery financing programs can help you pay for your weight loss procedure when insurance does not pre-approve the claim.

Self-pay patients can spend up to $24,000 for Gastric Bypass – a staggering amount that few people have on hand in a bank account.

Unsecured personal loans, in-house payment plans backed by third-party companies, and secured home equity loans allow you to pay the surgeon in advance and then repay the lender later on through installments.

However, patients with bad credit history and low FICO scores need a specialized strategy to win approval. You have several options to shed those pounds.

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Bariatric Weight Loss Finance Bad Credit

How do you finance bariatric weight loss surgery with bad credit? Adverse history appearing on your consumer report leads to a low FICO score, making it hard to win approvals and favorable terms.

Three strategies can help you compensate when you have a history of bankruptcy, charge-off, repossession, judgments, etc.

  1. Present your profile to a vast network of subprime lenders
  2. Keep the requested amount as small as possible
  3. Take advantage of tax code loopholes
Table Of Contents

Subprime Lenders

Request an unsecured personal loan (Sponsored Link) by completing a single online form that presents your credentials to a substantial network of subprime lenders. Choose “Medical” as the reason you want to borrow money.

When approval odds are low because of lousy credit scores, the number of specialty companies that see your profile can be the difference-maker. Volume matters!

Subprime lenders focus on personal loans for people with adverse history on their consumer report (bankruptcy, charge-offs, repossessions, judgments, etc.). Boost your approval odds further by having this information on hand.

  • Driver license number to verify your identity
  • Bank routing and account numbers to facilitate payment
  • Employer name, address, and phone number

If approved, the lender will deposit the funds directly into your checking account, which puts you in the driver’s seat. You can choose the local surgeon with the best resume, rather than the one that offers “in-house” payment plans.

Guaranteed

Guaranteed financing for weight loss surgery is not a realistic expectation. No legitimate company can guarantee approval to applicants with lousy credit history appearing on their consumer reports.

Instead of searching for guarantees, improve your approval chances by reducing the amount you need to borrow. Subprime lenders are more likely to say yes when you can afford the projected monthly installments.

  1. Take advantage of low-income grant opportunities that could scale back your out-of-pocket costs
  2. Identify the best health insurance for your procedure to limit your unreimbursed expenses
  3. Choose the most affordable operation (Balloon) to keep your self-pay amount as low as possible
    1. Gastric Bypass – $24,000
    2. Gastric Balloon – $8,150
    3. Gastric Sleeve – $19,000
    4. Lap Band – $15,140

Flex Spending

The tax code contains an odd loophole that makes bariatric weight loss surgery feasible with lousy credit history – at least for the Gastric Balloon alternative, which costs on average about $8,000 without insurance.

A Flexible Spending Account can work like an employer-funded, interest-free medical loan without a credit check that you repay in installments using pretax rather than post-tax dollars.

These are the steps you take and the benefits you might receive.

  1. Elect to fund the FSA during your annual open enrollment
    1. $2,750 Individual
    2. $5,500 Married couple
  2. Your employer cannot pull your consumer report – per IRS rules
  3. Schedule the procedure early in the FSA plan year
  4. Employer immediately reimburses $2,750 or $5,500
  5. Repay the employer(s) using pretax dollars over twelve months
  6. Reduce reported income by $2,750 or $5,500 and save on taxes
    1. Federal brackets: 10% to 37%
    2. FICA: up to 7.65%
    3. State brackets vary based on where you work
      1. California: 1% to 12.3%
      2. Texas: 0%
      3. Florida: 0%
      4. New York: 4% to 8.82%
      5. Pennsylvania: 3.07%
      6. Illinois: 4.95%
      7. Ohio: 0% to 4.8%
      8. Georgia: 1% to 5.75%
      9. North Carolina: 5.25%
      10. Michigan: 4.25%

Local Payment Plans for Weight Loss Surgery

Bariatric surgery payment plans are nothing more than a fancy name for a loan. All financing options feature a company that provides upfront funding to the patient or practice. The patient then repays in installments over time.

Your local surgeon went to medical school to help obese patients shed unwanted pounds. He or she knows little about risk underwriting and collections.

In-House

Your nearby office offering payment plans for a Gastric Sleeve or Gastric Bypass surgery is unlikely to do the financing in-house. Would you go to your local bank branch and ask them to perform a Lap-Band procedure. Of course, that would be silly.

Most surgical offices refer patients to third-party finance outfits as their “in-house” providers. These outside companies are not more lenient with their underwriting just because the practice is in your neighborhood. You risk rejection by waiting until the last minute to apply at your doctor’s office.

Secured Medical Loan

A secured medical loan is another example of weight loss surgery financing that results in a monthly payment plan. In most cases, a patient pledges the equity in their house to secure the loan, resulting in more favorable borrowing terms.

  • Home equity loans are installment contracts with fixed monthly payments
  • Home equity line of credit is a revolving arrangement with flexible monthly payments

A medical loan secured by the equity in your home can be more affordable because the interest rates are often lower and the repayment terms longer. However, there is a tradeoff. The lender can foreclose on your house if you fall behind on payments.