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KidVantage review: Line of credit for childcare expenses

Finance up to $2,000 in childcare costs each month with lower interest rates than most credit cards.

Bottom line: KidVantage is a new loan program for parents struggling to cover childcare costs. But it won’t be available in all states until 2021.

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Details

Max. Loan Amount$2,000
APR6.9% to 21.09%
Interest Rate TypeFixed
Min. Credit Score650
Late Fee$35

Pros

  • 6.5% to 21.9% interest rate
  • automatically pays childcare provider
  • no interest if you pay balance before it’s due

Cons

  • New, untested product
  • $35 late fee
  • not available in all 50 states until 2022

How does it work?

The KidVantage loan works more like a credit card than your standard personal loan. If you’re approved, the KidVantage loan will cover a percentage of your monthly child care expenses — starting at 40% and going up to $2,000.

JSF pays your child care providers on the first of each month, and payments from the borrower are due on the 27th. You can make a monthly payment on your balance. Or if you pay it off in full, you can avoid paying interest on that month’s expenses.

KidVantage rates, fees and terms

JSF charges interest on any balance that is left after the 27th, and its rates run from 6.9% to 21.9%. And if you sign up for automatic payments, you can qualify for a 0.5% rate discount.

The only other fee is if your payment doesn’t come in on time. JSF also charges a $35 fee if your payment is late or bounces. There’s no origination fee or annual fee.

How KidVantage compares to other lenders

While there’s no lender that’s quite like KidVantage, here’s how it stacks up to other personal lines of credit.

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Starting APR

6.9% to 21.09%

Loan term

Loan amount

Min. credit score

650

KidVantage reviews and complaints

KidVantage is a new product, so there aren’t any reviews as of February 2021.

How to qualify

Parents must meet the following requirements to qualify for the KidVantage loan:

  • Credit score of 650 or higher
  • Use a licensed child care provider
  • Annual income of at least $35,000
  • US citizen or permanent resident
  • Over 18

JSF isn’t launching the KidVantage loans program in all states at the same time. Colorado and California residents were the first to have access to this loan. But JSF says it’s planning on rolling it out to all states by the end of 2021.

How the application works

You can apply by filling out a short application on the JSF website. You’ll need to provide your basic contact information, monthly income, housing and child care expenses. Then read the disclosures and submit the form.

After you submit your application, you should receive a tentative offer and steps to complete your application and register your child care provider for payments.

JSF is currently offering two promotions. One gives you $100 toward child care and another gives you 0% interest for the first six months.

What sets it apart

The KidVantage loan program is one of a kind. Few lenders will regularly disburse funds to your child care provider each month — if any. And most loans don’t come with the option to pay off the balance in full each month.

Its rates are also relatively low even compared to other personal loans. It’s common for lenders to charge up to 36%, which is the legal limit in many states. But if you have excellent credit — or a score over 740 — and make a salary well over the $35,000 minimum, you might be able to find a lower rate with another personal loan provider.

Is KidVantage legit?

Yes, the KidVantage loan program is legitimate in that it’s upfront about the rates, terms and fees that you can expect. You can also easily get in touch using its live chat feature or calling the customer service line.

Launched in the middle of the coronavirus outbreak, the KidVantage was partly created from personal experience.

“We have two kids and have experienced firsthand the financial strain we are solving,” said JSF Chief Analytics Officer John Chalekian in a statement.

“Many parents face challenges in finding care that fits in their budget. They often settle for a lesser option in selecting a facility or provider. Many leave the workforce despite a preference to remain or opt to use high-interest credit to pay for care. We’ve created flexibility and the opportunity to make the best child care decision at a monthly payment families can afford.”

Compare KidVantage to our picks for the best personal lines of credit before you sign up.

Photo: Getty Images

Review by


Anna Serio is a trusted lending expert and certified Commercial Loan Officer who's published more than 1,000 articles on Finder to help Americans strengthen their financial literacy. A former editor of a newspaper in Beirut, Anna writes about personal, student, business and car loans. Today, digital publications like Business Insider, CNBC and the Simple Dollar feature her professional commentary, and she earned an Expert Contributor in Finance badge from review site Best Company in 2020.

Expert review

The KidVantage loan program is made specifically for parents struggling with the cost of child care from Jump Start Finance (JSF). It send monthly payments directly to companies and individuals that care for your kids, such as nannies, daycares and preschools.

With interest rates from 6.9% to 21.9%, it’s less expensive than putting these costs on a credit card. But since it’s new, there are no customer reviews and it might not be available in your state — yet.

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