A personal development loan is a loan for students either starting college or returning to college to get a better job. These loans are made to pay for the entirety of tuition, along with any other fees associated with college; dormitory fees may not be included, and the bank may refinance any existing loans. Some banks will charge a negotiation fee, but this fee may be waived if the loan is small. Most personal development loan plans are for either two or four years, and a percentage of the entire loan is paid each year, rather than in one lump sum. To receive a personal development loan, most applicants must have a college acceptance letter.
Personal development loans are made exclusively for college students who are looking to improve themselves, either as first-time students or as employees who need extra college to qualify for better positions. These loans pay for 100 percent of the college’s tuition, exam and book fees, and other associated costs. Some banks may not consider living expenses, such as dormitories, part of this loan, and some banks also may be willing to refinance other loans the students holds.
Negotiation fees are common for banks when someone is seeking a loan. These fees are applied on top of the loan, because the bank employee had to negotiate certain terms with the student. Loans that are considered small, around $5,000 US Dollars (USD) or less in 2011, typically do not come attached with negotiation fees.
Just as most colleges have two- or four-year programs, most banks offer two- or four-year personal development loan plans. Typically, the entire loan is split into two or four payments, each based on how much the student needs that year; some banks may just pay the student in one lump sum. The loan’s repayment begins about 30 to 60 days after the loan is supplied to the student, making this loan better for students who have a job, because less interest will accrue than with other student loans.
Every bank has its own criteria for giving out a personal development loan, such as how long the bank customer has had credit, his or her credit score and other factors. Aside from these factors, the applicant must have a college acceptance letter to prove that he or she is actually going to college. The letter also must have the year and costs attached to it, so the bank does not overpay.