Bootcamps have emerged over the past decade or so to fill a desperate need in the market: providing a vehicle for quickly transitioning into a new, high-quality field. At this they have been an unambiguous success.
But their popularity means that their services are in demand, and with high demand comes high prices. Paying for a full-time education is never cheap, and bootcamps are no exception.
- Speak to a career coach to get guidance
- Coaching sessions are free and always will be
As luck would have it, the same ingenuity that gave rise to bootcamps in the first place has also incentivized entrepreneurs to develop financing options.
There are a number of ways to pay for your bootcamp education, and here we’re going to discuss loans and compare them to income service agreements.
Loans for Coding Bootcamp
As we all know, a loan is a sum of money you are given upfront to finance a project and which must be repaid at a later time, with interest. With respect to coding bootcamps, loans come in two basic kinds.
The first is a loan from a traditional financial institution like a bank or a credit union. In most cases there’s nothing stopping you from figuring out how much a bootcamp costs and approaching Wells Fargo, USBank, or whomever to see if they’ll bankroll your education.
I see two issues with this approach. The biggest one is that a lot of these standard sources of funds don’t have a good understanding of bootcamps or the value they add to prospective students. Unless your local bank is pretty ‘with it’, they’ve probably never financed a bootcamp attendee and don’t have any precedent for setting interest rates, repayment periods, and the like.
The smaller potential issue is that a lot of bootcamps have direct partnerships with finance providers to make loans to their students. This isn’t so much an ‘issue’ — to the best of my knowledge bootcamps won’t forbid you from getting a loan from someone else — it’s just something to keep in mind as you move forward in the process.
And speaking of direct partnerships, the second kind of loan comes from the bootcamp’s preferred lender. Galvanize, for example, has a special relationship with Skills Fund to provide student loans. These loans are a little high on the interest, but only require small nominal monthly payments for the first half year (to give you time to find a job), and have lots of deferment options.
Loans vs. Income Share Agreements (ISAs) for Bootcamp
Some bootcamps offer Income Share Agreements (ISAs) as an alternative means of paying for your education. With an ISA, you don’t owe anything at all until you get a job, at which point you agree to hand over a fraction of your income to the bootcamp, up to a certain maximum amount.
There are lots of advantages to this way of doing things. The biggest is that you aren’t struggling under the burden of high student loan payments if you wind up on the lower end of the pay scale because the amount you owe is pegged to your salary.
ISAs vary on the length of the contract and the fraction of income expected. Be sure you’re clear on the ISA terms before committing to it.
Today, there are myriad ways of getting the funds you need to make a positive change. That’s a fact worth celebrating.
Need help financing coding bootcamp? Career Karma connects you to the resources you need to find your tech education!