How to Avoid Scams and Find Legit Cosmetology School Loans

 June 26, 2019
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For many people, becoming a hair stylist, colorist, or cosmetologist is a dream career. It’s a path that is quite different than spending four years in college and taking a desk job, even if cosmetology school loans are sometimes needed.

Among the attractions, a role in a salon allows you to work with your hands, meet new people, work a flexible schedule and create beautiful looks. Plus, top stylists can earn $25 an hour or more, and demand for cosmetologists is expected to remain strong, so it can be a way to make a solid income without getting a bachelor’s degree.

But the appeal of a career in cosmetology also makes the beauty school industry rife with scams. Along with hundreds of reputable schools, there are also some that rob students of their hard-earned money and leave them without any job prospects. Even after shady schools shut down, former students can get stuck paying the price of cosmetology school loans.

Here’s what to watch for, and how to find student loans for cosmetology school that are legit.

Beware cosmetology school loans from corrupt schools

One major case against a cosmetology school involved the Jon Louis School of Beauty in New York. The school was accused of misusing federal student loan funds and targeting low-income and non-English-speaking students, saddling them with debt in order to make a profit.

Jon Louis and other similar schools have closed, but some students still face cosmetology school loans. Others paid thousands of dollars and took out loans to go to school, but never received the necessary training and credentials.

Students have reported being unable to pass state licensing exams and only qualifying for unskilled jobs in the salon, such as hair washing or cleaning up at the end of the day. Many are unemployable after graduation, and end up taking low-paying jobs in fast food or retail to make ends meet.

If a school peddles in fraudulent degrees, it can leave you without the required education and training, as well as mountains of loans that need to be repaid.

With any secondary education program, if a program sounds too good to be true, it probably is. The U.S. Federal Trade Commission cautions aspiring students to be on the lookout for schools that make lofty promises that seem hard to deliver, like:

  • No exams and no coursework
  • Getting significant course credit for your previous work experience
  • A flat fee rather than paying per course or semester
  • The opportunity to graduate in a very short window of time

Another concern for students looking for help paying for vocational school is student loan scams. When pursuing financial assistance, the U.S. Department of Education advises students to beware of loans that sound too good to be true, such as those promising immediate debt forgiveness, loans requiring you to pay money up front and offers from anyone who requests your FSA ID or asks you to sign a third-party power of attorney.

In addition, just because an email or piece of mail has the Department of Education seal, that doesn’t mean it is a legitimate lender. If you think you may be the victim of a loan scam or you want to research a potential lender, you can contact the Federal Trade Commission or your state attorney general’s office.

Identifying a reputable beauty school

Natyssa Taras works as a licensed hairstylist and regional educator with Eufora International, which offers training opportunities for those in the hair and beauty industry. After years in the business, she urges potential cosmetologists to do their homework before choosing a school.

“Aspiring hair stylists looking at beauty schools should first look for accreditation,” said Taras. “This comes from the state in which the school is located, their board of education, as well as licensing groups like the New York State Beauty School Association.” Accreditation is a key indicator that the school prepares students for employment after graduation.

Additionally, Taras recommends that potential students visit schools in person.

“Websites can only tell you so much,” said Taras. “Talk to teachers about continued education after graduation, job placement and apprenticeships. Instructors should be state-certified, as each state has their own program for professionals to become licensed cosmetology instructors.”

Getting cosmetology school loans

The cost of beauty school can vary, depending on the location and the school’s brand.

“The average cost in my area of New York is $12,000 for a 36-week program,” said Taras. “A ‘brand’ school like Paul Mitchell, Sassoon, and others will cost more, but beware of paying a premium for a name only. Do your research, and talk to current students and alumni if you can.”

Schools can cost anywhere from $5,000 to $20,000 in tuition, with additional expenses for room, board, textbooks and transportation. According to estimates from Empire Beauty School, the costs for textbooks and supplies could run an additional $2,000 to $3,000 per year.

When it comes to paying for school, you’ll have more options if you attend an accredited school; most federal loans are only available if the school you choose is an accredited institution.

If your school has the required credentials, you can apply for financial aid using the Free Application for Federal Student Aid (FAFSA), just as you would for a four-year university. If you have a relatively lower income, you may qualify for a Pell Grant to help cover the cost of your education, which you do not have to pay back.

Even if you don’t qualify for a grant, federal student loans have a low interest rate and offer repayment programs that can make your monthly payments affordable. Always see if you are eligible for a federal student loan first before turning to private student loans.

You may also be eligible for federal or state grants, which do not have to be repaid. The American Association of Cosmetology Schools also offers resources on available grants and scholarship programs.

If federal loans or scholarship programs are not an option for you, start researching private loans from reputable lenders, including banks and credit unions. In other cases, beauty schools offer financing themselves or offer payment plans to make it easier on you, such as through cosmetology school loans.

Avoiding trade school scams

Whether you’re investigating beauty schools or any other vocational school, be careful to pick a reputable school with a proven track record for training students properly and helping them find employment.

As mentioned above, illegitimate schools may lure students in with low-cost programs or promises of a quick coursework. These so-called diploma mills could take your money and leave you without the necessary training or certification to pursue your chosen career. Schools might have prestigious sounding names, with words like “national,” “federal” or “institute,” but that doesn’t legitimize them.

To confirm a school is on the level and avoid scams, it is important to do your homework. Here are some things to check:

  • Research the school’s degree or certification offerings
  • Look on its website and marketing materials for accreditation for both the school and the individual programs
  • Check with industry organizations, such as the American Association of Cosmetology Schools, to verify a school’s membership and accreditation
  • Search the Council for Higher Education’s database, which includes information on 8,500 post-secondary schools, including cosmetology programs, and information on accreditors
  • Call the school and ask to be connected with recent graduates
  • Read up on the school on job boards and social media
  • Check on the school’s timeline for graduation — if it seems too quick to receive proper training, it could be a scam
  • Contact your state’s attorney general to see if a school has any outstanding complaints

Entering a career in cosmetology can be rewarding and provide you with a solid income. But if you’re considering attending beauty school, make sure you understand the necessary accreditation in your state and the qualifications you need to find a job after graduation.

Alli Romano contributed to this report.

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Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers. If approved, your actual rate will be within a range of rates and will depend on a variety of factors, including term of loan, a responsible financial history, income and other factors. Refinancing or consolidating private and federal student loans may not be the right decision for everyone. Federal loans carry special benefits not available for loans made through Splash Financial, for example, public service loan forgiveness and economic hardship programs, fee waivers and rebates on the principal, which may not be accessible to you after you refinance. The rates displayed may include a 0.25% autopay discount

The information you provide to us is an inquiry to determine whether we or our lenders can make a loan offer that meets your needs. If we or any of our lending partners has an available loan offer for you, you will be invited to submit a loan application to the lender for its review. We do not guarantee that you will receive any loan offers or that your loan application will be approved. Offers are subject to credit approval and are available only to U.S. citizens or permanent residents who meet applicable underwriting requirements. Not all borrowers will receive the lowest rates, which are available to the most qualified borrowers. Participating lenders, rates and terms are subject to change at any time without notice.

To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

Splash Financial and our lending partners reserve the right to modify or discontinue products and benefits at any time without notice. To qualify, a borrower must be a U.S. citizen and meet our lending partner’s underwriting requirements. Lowest rates are reserved for the highest qualified borrowers. This information is current as of May 4, 2022.

2 Rate range above includes optional 0.25% Auto Pay discount. Important Disclosures for Earnest.

Earnest Disclosures

Student Loan Refinance Interest Rate Disclosure Actual rate and available repayment terms will vary based on your income. Fixed rates range from 2.99% APR to 8.24% APR (excludes 0.25% Auto Pay discount). Variable rates range from 1.99% APR to 8.24% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. The maximum rate for your loan is 8.95% if your loan term is 10 years or less. For loan terms of more than 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95%. Please note, we are not able to offer variable rate loans in AK, IL, MN, NH, OH, TN, and TX. Let us know if you have any questions and feel free to reach out directly to our team.

3 Important Disclosures for CommonBond.

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Offered terms are subject to change and state law restriction. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900), NMLS Consumer Access. If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. ‍All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 0.15% effective Apr 22, 2021 and may increase after consummation.

4 Important Disclosures for SoFi.

SoFi Disclosures

Fixed rates range from 3.49% APR to 7.99% APR with a 0.25% autopay discount. Variable rates from 1.74% APR to 7.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates on 5-, 7-, and 10-year terms are capped at 8.95% APR; 15- and 20-year terms are capped at 9.95% APR. Your actual rate will be within the range of rates listed above and will depend on the term you select, evaluation of your creditworthiness, income, presence of a co-signer and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi.

5 Important Disclosures for Laurel Road.

Laurel Road Disclosures

All credit products are subject to credit approval.

Laurel Road began originating student loans in 2013 and has since helped thousands of professionals with undergraduate and postgraduate degrees consolidate and refinance more than $4 billion in federal and private school loans. Laurel Road also offers a suite of online graduate school loan products and personal loans that help simplify lending through customized technology and personalized service. In April 2019, Laurel Road was acquired by KeyBank, one of the nation’s largest bank-based financial services companies. Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. All loans are provided by KeyBank National Association, a nationally chartered bank. Member FDIC. For more information, visit

As used throughout these Terms & Conditions, the term “Lender” refers to KeyBank National Association and its affiliates, agents, guaranty insurers, investors, assigns, and successors in interest.

  1. Checking your rate with Laurel Road only requires a soft credit pull, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.
  2. Savings vary based on rate and term of your existing and refinanced loan(s). Refinancing to a longer term may lower your monthly payments, but may also increase the total interest paid over the life of the loan. Refinancing to a shorter term may increase your monthly payments, but may lower the total interest paid over the life of the loan. Review your loan documentation for total cost of your refinanced loan.
  3. After loan disbursement, if a borrower documents a qualifying economic hardship, we may agree in our discretion to allow for full or partial forbearance of payments for one or more 3-month time periods (not to exceed 12 months in the aggregate during the term of your loan), provided that we receive acceptable documentation (including updating documentation) of the nature and expected duration of the borrower’s economic hardship. During any period of forbearance interest will continue to accrue. At the end of the forbearance period, any unpaid accrued interest will be capitalized and be added to the remaining principle amount of the loan.
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Assumptions: Repayment examples above assume a loan amount of $10,000 with repayment beginning immediately following disbursement. Repayment examples do not include the 0.25% AutoPay Discount.

Annual Percentage Rate (“APR”): This term represents the actual cost of financing to the borrower over the life of the loan expressed as a yearly rate.

Interest Rate: A simple annual rate that is applied to an unpaid balance.

Variable Rates: The current index for variable rate loans is derived from the one-month London Interbank Offered Rate (“LIBOR”) and changes in the LIBOR index may cause your monthly payment to increase. Borrowers who take out a term of 5, 7, or 10 years will have a maximum interest rate of 9%, those who take out a 15 or 20-year variable loan will have a maximum interest rate of 10%.


This information is current as of April 29, 2021. Information and rates are subject to change without notice.

6 Important Disclosures for Navient.

Navient Disclosures

You can choose between fixed and variable rates. Fixed interest rates are 2.99% – 8.24% APR (2.74% – 7.99% APR with Auto Pay discount). Starting variable interest rates are 1.99% APR to 8.24% APR (1.74% – 7.99% APR with Auto Pay discount). Variable rates are based on an index, the 30-day Average Secured Overnight Financing Rate (SOFR) plus a margin. Variable rates are reset monthly based on the fluctuation of the index. We do not currently offer variable rate loans in AK, CO, CT, HI, IL, KY, MA, MN, MS, NH, OH, OK, SC, TN, TX, and VA.

7 Important Disclosures for LendKey.

LendKey Disclosures

Refinancing via is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it  endorse,  any educational institution.

Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised variable APR is only available for loan terms of  5 years and is reserved for applicants with FICO scores of at least 810.

As of 11/15/2021 student loan refinancing rates range from 1.90% APR – 5.25% Variable APR with AutoPay and 2.49% APR – 7.75% Fixed APR with AutoPay.

8 Important Disclosures for PenFed.

PenFed Disclosures

Fixed Rate Loan Terms: 5 years/60 monthly payments, 8 years/96 monthly payments, 12 years/144 monthly payments or 15 years/180 monthly payments. Annual Percentage Rate is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Fixed rates range from 3.29% to 5.43% APR. Rates are subject to change without notice. Fixed APR: Fixed rates will not change during the term. This rate is expressed as an APR. Since there are no fees associated with this loan offer, the APR is the same percentage as the actual interest rate of the loan. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.