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Using A Career Development Loan For Postgraduate Study

We've all heard of student loans. These are the loans that help school leavers fund their university education. But what if you want to continue learning after you have left university and have started work? Luckily, not all loans for study are given to undergraduates. There are loans to help employed, self-employed or unemployed people with further study. They are called career development loans.

What Is A Career Development Loan?

A career development loan (CDL) is a loan which helps people to improve their job skills and therefore their job prospects. The loans are available from three high street banks through an arrangement with the Learning and Skills Council. The three banks are the Cooperative Bank, the Royal Bank of Scotland and Barclays.

The loans help develop people's careers by funding a course of work-related study for up to two years. Some three year courses with a substantial work experience component may also be funded.

How Much Can I Borrow?

CDLs allow people to borrow anywhere between £300 and £8,000 for periods of 12 to 60 months. The typical annual percentage rates quoted by banks vary considerably, from 6.3% to 17.9%. The interest rate on the loan is fixed during the repayment period so you will always know how much your monthly repayments are. The LSC pays the interest on the loan while you study and for a month after the end of the course. After that you are responsible for repaying the principal and interest, as with a normal loan.

What Does A CDL Cover?

A career development loan covers study related expenses such as:

  • course fees
  • living expenses
  • related course costs

Course fees are covered fully for people who have been unemployed for three months or more. Otherwise, only 80% of the course fees are covered.

Living expenses such as housing, utilities, food and clothing are covered by the loan, provided you are not already claiming another benefit to pay for these.

Books and equipment needed for the course, travel to and from the course and childcare are also covered by the loan.

What Type Of Course Can I Do?

There are three types of courses that are specifically excluded from the CDL scheme. These are career courses, franchise courses and foundation courses. All other courses offered by an accredited provider can be taken. These can be full-time, part-time or distance learning courses. They can be vocational courses or academic courses, as long as they relate to your career.

To choose a course, it is best to look at prospectuses, talk to course tutors, visit the institution and chat with former students. All of these will help you decide if a particular course is right for you. You will also need to make sure that you meet the application criteria before you apply for the course.

How Do I Apply For A CDL?

You need to apply for the loan through one of the participating banks (but only one bank at a time). The application forms will ask you to estimate your living expenses to help you decide how much to borrow. It is best to apply well before the start of the course to leave plenty of time for the loan to come through, so it is useful to apply at least three months before. Banks will use their usual criteria to see if you are likely to be able to repay the loan. Once your loan has been issued, you can confirm your place on the course and start studying. Good luck!

More Information:

  • Graduate loans
    Graduate loans are an increasingly common form of unsecured personal loans that allow new graduates to consolidate debt. For many people this is an attractive way to firm up their finances when making that first foray into the world of working full time
  • Student Loans
    An article overviewing the UK student loan market, focusing on who qualifies and find out what amounts of income you need to earn to become eligible for this Government lending.

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