How to Borrow Student Loans for Certificate Programs

Certificate programs provide a flexible learning option for individuals looking to continue their education, boost their earning potential or pivot to a new career path. It's also a great option for non-degree-seeking students pursuing careers that don't necessarily require a college degree.

A certificate program might not cost as much as a four-year degree, but it can still be expensive. Your employer might cover all or a portion of continuing education costs, but finding student loans for certificate programs is an option if they don’t.

Types of federal student loans for certificate programs

Taking out student loans keeps you from paying upfront for classes, which might be better than racking up credit card debt or tapping into your savings. Federal student loans are an option, as are private student loans, as long as you qualify for them.

Students take out federal student loans to pay for bachelor's and postgraduate degrees but can also do so for eligible certificate programs. Schools that offer certificate programs that might be eligible for federal financial aid include:

• Community colleges
• Career schools
• Trade schools
• Technical schools

Federal loans should be the first option for most students when borrowing money to pay for school. They offer more flexible repayment options than private loans and come with additional borrower protections. The U.S. Department of Education offers several loan options that could fit the bill.

Subsidized Direct Loans

Subsidized Direct Loans are for eligible undergraduate students that display financial need. With subsidized loans, the government pays the interest that accrues on the loan:

• While you're in school at least half-time,
• During the six-month grace period after graduating or leaving school, and
• During periods of deferment.

Dependent students can borrow a maximum of $23,000 (aggregate) in subsidized student loans.

Unsubsidized Direct Loans

Unsubsidized Direct Loans are another option to consider for federal loans. You don't need to demonstrate financial need to qualify for direct unsubsidized loans. However, borrowers are responsible for paying the interest on unsubsidized loans during all periods, including when attending school.

Dependent students can borrow a maximum of $31,000 (aggregate) between unsubsidized and subsidized student loans.

Grad PLUS Loans

If you've already obtained a college degree, Direct PLUS Loans can help pay for further educational pursuits like certificate programs. Grad PLUS Loans are for graduate and professional students enrolled at least half-time in an eligible degree or certificate program.

Grad PLUS Loans have higher interest rates than other federal loans but don't carry borrowing limits like subsidized and unsubsidized loans. With PLUS Loans, you can borrow up to your school’s reported cost of attendance minus other financial assistance received.

PLUS Loans are the only federal student loans that require a credit check. If you have an adverse credit history, you might still qualify with the help of an endorser. An endorser agrees to pay off the loans if the borrower can't, similar to a student loan cosigner.

Paying for certificate programs with private student loans

If you've exhausted federal options or your certificate program doesn't qualify for federal aid, you can also take out student loans through private lenders. Several lenders offer career loans and other options you can use to pay for certificates from trade schools, online schools and other education options.

Depending on your credit and financial history, you might qualify for low interest rates on private student loans. Below are lenders that offer private student loans for certificate programs.

College Ave

College Ave offers undergraduate and graduate career loans for qualified borrowers. Career loans through College Ave can cover up to 100% of the cost of certificate programs at eligible schools. Loans come with fixed or variable interest rates and loan payment terms from five to 15 years. College Ave also offers several repayment options to fit your needs.

Sallie Mae

Sallie Mae Smart Option Student Loans offer flexible repayment terms and rate options and come with additional perks like access to Chegg Study tools.

The lender is one of the few private lenders that allows borrowers to take out private student loans without a cosigner. You can qualify for Sallie Mae loans regardless of whether you attend in-person or online, and students enrolled less than half-time can also qualify.

Ascent

Ascent is a private lender that offers private loans for professional training and certificate programs at participating schools. Loans cover up to the total cost of tuition for eligible programs. Accent offers several repayment plans and three loan term choices — 60 months, 84 months, or 120 months. Ascent only offers fixed rates on its career loans.

How to apply for student loans for a certificate program

You must apply for student loans to receive financial assistance to pay for a certificate program. The application process varies depending on the type of student loan and the lender. Follow the steps below to apply for federal or private student loans.

Federal student loans

1. Fill out FAFSA

The first step to receiving federal student loans is to fill out and submit the Free Application for Federal Student Aid (FAFSA). The Department of Education uses the FAFSA to determine eligibility for federal student aid, including student loans, grants, and work-study programs.

2. Receive Student Aid Report

Once you've submitted the FAFSA, the Department of Education will send you a Student Aid Report (SAR) outlining your federal aid eligibility. They also send SARs to any schools you list on the FAFSA. Review information on your SAR to verify it's correct

3. Receive aid offers

Your school determines how much aid you can receive based on information provided on the FAFSA. You can choose to accept their offer or reject it. If you accept the offer, the school will direct you on the next steps to take in the process.

Private student loans

The application process for private student loans varies between lenders. Generally, applying for a private loan will include the following steps.

1. Check your credit

Before applying for a loan, check your credit score and report to gauge whether you're likely to get approved for a loan on your own or if you need a cosigner to qualify.  You can access free copies of your credit report from the three major credit bureaus at AnnualCreditReport.com. Some banks and credit card issuers offer free credit score access, or you can get your score from free and paid credit scoring websites. Experian offers free FICO credit score access.

2. Determine your need

Calculate how much you need to borrow to pay for the certification program at your school. Factor in any other aid or out-of-pocket payments you plan to make. Only borrow what you need since you'll pay interest on the total balance.

3. Shop around private student lenders

Compare lenders and interest rates to find the right student loan for your situation. Many lenders allow you to check rates before applying, which won't hurt your credit score.

4. Apply for a loan

Generally, you can apply for private student loans online. During the process, the lender will ask you to provide pertinent personal and financial information to verify your identity and help them determine eligibility and creditworthiness. You may have the option to apply with a cosigner if your credit isn't good enough on your own, or you want to qualify for better interest rates.

5. Accept the loan

Depending on the lender, it may take several days to hear if you qualify for a loan. You can accept or decline the offer if approved for a loan. Follow the steps given by the lender to accept the loan and set up an account.

Is a certificate program right for you?

Certificate programs can provide an alternative to pursuing a traditional college degree and additional training to advance or switch careers. While it's a great path for many, it may not be the best option for everyone. Consider the benefits and drawbacks of certificate programs to determine if getting a certificate is right for you.

Pros

• Take less time to earn than a traditional degree.
• Often costs less than a college degree.
• Provide continued education in career-related subject matter.
• Verifies your knowledge in a particular area.
• Sometimes provides a path toward a new career without getting another degree.

Cons

• Employers may require applicants to have a college degree.
• It may not help advance your career or increase income.
• It may be challenging to balance school with other responsibilities if you already have a career.
• It still costs money to pursue a certificate.

Alternative options to pay for certificate programs

Student loans aren't the only way to pay for certificate programs. Consider these potential alternatives if you're thinking about pursuing a certificate:

• Scholarships
• Grants
• Employer contributions
• School payment plans
• Personal loans
• Personal savings

Determine the best course of action for your situation. If you're unsure how to pay for a certificate program, let us help. Book a consultation today with one of our consultants, who can help guide you through your options and create a customized game plan for paying for your education.