The Freshers’ Guide to Student Loans 2013/14
Learn about How to Fund your Degree at University!
The loans that they provide tend to fall under two categories: maintenance loans and tuition fee loans.
In Depth Guide to Student Finance 2012:
- How to Apply to Student Finance 2013/14
- Student Loans Repayment – How Much do I have to Pay Back?
- Student Finance for EU Students
- Student Finance for Part-Time Students
- Student Finance for Welsh Students
What’s a maintenance loan?
A maintenance loan is basically there to help you afford the everyday cost of living. With a maintenance loan you can buy books, food, go on nights out, and so on. Everyone can apply for a maintenance loan – the loan will be paid back once you finish at university. If you don’t need to saddle yourself with the debt associated with a maintenance loan then it’s probably a good idea not to. That said, student loans are widely regarded as being the cheapest money you’ll ever borrow – and the repayment terms are very favourable.
What’s a tuition fee loan?
You won’t actually see the tuition fee loans, because they’re paid directly to the institution at which you’re studying. Tuition fee loans cover the full cost of your tuition fees and like the maintenance loan they must be repaid on completion of university (providing you meet some financial stipulations).
Student loans are there to make higher education accessible for everyone – not just people whose families are very well off. The only exceptions to these loans are people who choose to study in London – they may receive more than people in order parts of the country due to “London weighting”.
Alternative student loan providers
There are lots of private companies out there who will loan you the money that you need to study. Just remember that these companies are likely to charge far higher interest fees than the Student Loans Company – which makes them very unattractive.
Must I take a loan?
If you don’t need to take a loan, don’t! If you’re planning on working throughout university and you think you can support yourself, that’s absolutely fine. Remember you can go back at any point during the year and apply for a back dated loan if you should fall on hard times. If you’re planning on satying with parents during university, or your parents are going to foot the bill for you, you can leave university with a clean state, and student debt like lots of other people your age.
As well as student loans there are other forms of finance out there that are geared at students. Lots of universities tend to offer bursaries, and government grants are also available for students whose family income is less than certain amounts.
What are the repayment terms?
Repayment terms on student loans have recently changed. For those who took a loan between 1998 and 2011 you repay 9% of earnings over £15,000. It’s a little more confusing for students who took a loan in 2011 onwards, they must repay their student loan if they earn over £21,000 per year, at a rate of RPI + 3% (where RPI is the Retail Price Index).
If you’re determined to study at university and you’ve got the grades to be accepted onto a course, a student loan ensures that you don’t miss out on the opportunity to become a student.