A career development loan is a loan that you can get to cover the cost of study which will improve your career. You have to let them know what you are studying so that they can decide whether they are prepared to help you finance that course. They will cover the costs of the course as well as some living expenses. They are not like a student loan, as although you will not have to make repayments until the course ends, you will have to start repaying immediately on completion of the course and your income is not taken into consideration either when deciding whether you can have the loan or when deciding on the repayment amounts. The repayments are a set amount and you have to pay them regardless of your income, even if you do not have a job at all. The interest rate could also be a lot higher than a student loan.
Who are they for?
These loans are meant for those that have already used their student loan allowance (or a grant if they are an older generation) and want to study further. Due to the fact that they are expensive and you have to repay it no matter what your income, they are a risk and it is worth thinking hard about whether you feel that they are really the right option for you.
It will be best if you can pay the course yourself or get your company to fund it. However, it is unlikely that these options are available to you if you are considering this sort of loan. Same like with payday loans without credit checks It is worth though, comparing it to other types of loans to see whether they will be better. The fact that you do not have to start repayments until the course ends could be a big selling point though. If the course is only part-time, then you may be able to work as well and therefore afford repayments on a regular loan. However, if you are studying full-time and have no other income source, then this sort of loan could be the better option for you.
However, all loans are expensive. You will always pay more for something if you use a loan to pay for it compared to buying it with your own money unless you are lucky enough to get an interest free loan. It can be much better to try to save up the money yourself and use that to pay for the course rather than using a loan. Depending on the cost of the loan, this may not take too long. You may think that you cannot do this, but if you can find money to repay a loan, then you could save that amount of money each month instead and not have to pay the extra. Obviously this will mean that you will have to delay your course, but it could be worth it if you save a lot of money.
Is it Good Value?
Thinking about whether the loan is good value for money also needs to include thoughts about the course. Consider what it will do for you with regards to the money it could potentially generate for you. Will it generate enough to be able to more than cover the costs of the course and if so how long will it take for those costs to be covered? If you are not sure, then think about what jobs you might be able to get as a result of getting the qualification. Look at how much those jobs pay and compare that with what you are getting ow. Calculate how much more you will have and think about how long it will take you to think about whether you still think that it will be worth doing that course.
Obviously, you may have more reasons than financial ones for doing the course. You may just enjoy learning new things or want to gain knowledge in that specific area or just have a qualification to show that you know it. If this is the case then the cost may not be of so much importance, but it is still worth taking a look to make sure that you are funding it in the best way for you.