How to Compare Coding Bootcamp Loan Providers
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Those attending coding bootcamps have a variety of payment options at their disposal. One of these options is taking out a loan. Many coding bootcamp loans are specifically designed for bootcamp students. Depending on your financial needs and personal credit score, bootcamp loan providers offer different rates and terms.
It is important to have a clear understanding of each loan provider's offerings to find the best fit for you. Keep in mind: not all loans are created equal. Make sure you read and understand all the loan terms and conditions before you commit to one.
This guide will help you explore bootcamp loan providers, think through the pros and cons of bootcamp loans, and figure out what questions you should ask before you make your loan decision.
Why Use a Coding Bootcamp Loan Provider?
Bootcamps can be great for those wanting to learn a new tech skill or get to the next level in their professional career, but they often come with a steep price tag. BestColleges collected data from about 130 bootcamp providers in 2020 and found the median bootcamp tuition cost was $13,500.
To cover these costs, bootcamp students can often choose from multiple payment options, including bootcamp loans. However, students cannot typically use federal student aid or traditional student loans to cover bootcamp costs. Instead, bootcamp students can apply for personal loans to pay for their bootcamp education, or they can apply for a loan specifically tailored for bootcamp students; these types of loans may have better interest rates than a typical private loan.
Bootcamp loan providers partner with coding bootcamps to streamline the loan application process for students. In addition to potentially lower interest rates, many loans designed for bootcamp students also offer more flexible repayment schedules than other private loan options.
Pros and Cons of Bootcamp Lenders
Getting a loan from a bootcamp lender comes with both pros and cons. On the plus side, many bootcamp lenders partner with bootcamps directly, making it easier to communicate with a lender. Bootcamp loan applications may also take very little time to complete.
Additionally, many bootcamp loan lenders provide deferred repayment options. With these, students may only pay the interest on their loan or nothing at all while they are enrolled in their bootcamp and possibly for a short period after they finish their bootcamp, such as a period of three months.
However, be aware that bootcamp loans may come with shorter payback periods than other loans. And while bootcamp loans may have lower interest rates than some other private loans, they still tend to have higher interest rates than traditional student loans.
Coding bootcamp loans also come with limitations. For instance, most cannot be used to cover costs outside of bootcamp tuition, such as living expenses.
Furthermore, since bootcamp lenders usually partner with specific coding bootcamps (often based on performance and success rates), you may not be able to get a loan from a specific bootcamp lender for your coding bootcamp. Make sure your desired lender has a relationship with the bootcamp you're interested in.
How to Evaluate Bootcamp Lenders
When selecting a bootcamp loan provider, consider a few key factors. First, assess your ability to repay the loan. This includes evaluating your salary potential post-bootcamp to determine if you will be in a good position to make timely loan payments.
Investigate whether the lender has a preexisting relationship with your bootcamp, which may make the process of applying for a loan easier. Also determine if the application process seems straightforward and clear. You want to be sure that the lender you work with communicates reliably and transparently.
With that in mind, if you want to understand a loan, you need to know the lingo. Lending terms you should know include:
Finally, when researching bootcamp loan providers, it also helps to ask the right questions. Here are a few questions you should ask a potential lender:
Skills Fund, a popular bootcamp lender, also provides a list of questions to ask before agreeing to a loan. Below, we've listed some details about Skills Fund and other bootcamp lenders to help get your research started.
Comparing Bootcamp Loan Providers
- Starting APR: 10.99%
- Repayment Terms: 3 years
- Cosigner Option: Yes
- Deferment/Forbearance Options: Yes
- Bootcamp Partners: App Academy, Code Fellows, Devmountain, Epicodus, Flatiron School, Galvanize, General Assembly, Hack Reactor, Springboard, and more
Climb Credit prioritizes relationships with high-performing bootcamps. The Climb Credit loan application takes about four minutes to complete and the lender considers a variety of factors (not just credit score) during the loan approval process. Borrowers who set up repayment using autopay receive an interest rate discount.
- Starting APR: 11.08% (for DigitalCrafts)
- Repayment Terms: 3 or 5 years
- Cosigner Option: Yes
- Deferment/Forbearance Options: Yes
- Bootcamp Partners: Bottega, Codeup, Coding Dojo, DigitalCrafts, Flatiron School, Fullstack Academy, Galvanize, Tech Elevator, Thinkful, and more
Skills Fund offers a variety of loan types for coding bootcamp students, including interest-only, immediate repayment, and deferred repayment options. Skills Fund selects bootcamps partners based on a bootcamp's admissions rates, curriculum, instructor experience, and student outcomes. Skills Fund is also a founding member of the Council on Integrity in Results Reporting, an organization that promotes transparent and uniform bootcamp outcome measurement standards.
- Starting APR: 8.94%
- Repayment Terms: 3 or 5 years
- Cosigner Option: No
- Deferment/Forbearance Options: Yes
- Bootcamp Partners: Coding Dojo, General Assembly, Launch Academy, and more
Upstart offers bootcamp students fixed-interest-rate loans with no prepayment penalties. In addition to credit score, Upstart considers an individual's education and professional experience when approving loan borrowers. To qualify for a loan, applicants must have a minimum credit score of 600 and live in the United States.
Frequently Asked Questions About Bootcamp Loans
While you cannot get a federal student loan to pay for a bootcamp, many private lenders now offer loans designed specifically for bootcamp students. These loan options may have lower interest rates and more flexible repayment schedules than typical private loans.
Bootcamps vary in cost. A full-time program typically costs between $10,000 and $15,000. BestColleges collected data from more than 620 bootcamp programs and found that the average bootcamp tuition price in 2020 was $13,580. Part-time programs cost slightly less, with an average tuition of $12,265.
Depending on your needs, coding bootcamps can be worth it. Bootcamps provide an opportunity to learn a specific, in-demand discipline in a relatively short amount of time. In comparison to typical two- and four-year degrees, their accelerated timeline and flexible schedule may be ideal for those seeking to quickly switch careers or enhance their expertise in their current field.