| If you are about to start University, | | | | this if you wish, by sending money to |
| then it pays to know about the student | | | | the appropriate authority. |
| loan process. Most students take out | | | | What is the interest? |
| some form of student loan during their | | | | The interest on student loans is |
| study to help them pay for their fees | | | | subsidised by the Government, and so you |
| and living expenses. If you are unsure | | | | only pay back the same amount that you |
| about how student loans work, then this | | | | borrowed, adjusted for inflation. |
| guide will be able to help you. | | | | However long it takes you to pay back |
| How are loans paid? | | | | the loan, you will only pay back the |
| Student loans are paid in three | | | | same amount in real terms that you |
| instalments each year, usually once each | | | | borrowed. |
| term. The first payment is usually made | | | | What are the advantages of taking out a |
| by cheque, and then after that payments | | | | loan? |
| will go straight into your bank account. | | | | The advantages of taking out a loan are |
| How much can I receive? | | | | that you have money in order to pay for |
| The amount you will receive depends on | | | | your living costs whilst at University, |
| where in the country you are going to | | | | meaning that you can concentrate on your |
| attend University, as well as the | | | | studies rather than having to work to |
| financial status of you and your family. | | | | earn money. This will help you to |
| You can opt to get a fixed amount per | | | | achieve better grades and give you more |
| year, or you can be income assessed and | | | | free time. Also, taking out an interest |
| the maximum amount you can receive will | | | | free loan is better than getting into |
| be determined. You can take as little or | | | | debt on high interest credit cards. |
| as much of this amount as you want. On | | | | These debts are more serious and have to |
| average the amount you can receive | | | | be paid back or they will keep |
| ranges from £1,500 to £4,500 each | | | | increasing. |
| year, depending on your financial | | | | Are there any disadvantages? |
| status. | | | | Obviously, the major disadvantage of |
| How do I pay back the loan? | | | | taking out student loans is that you |
| After you have finished University, you | | | | will come out of University with a large |
| will begin paying back the loan. | | | | amount of debt. This can seem troubling |
| Repayments will start from the April | | | | at first, but you should remember that |
| after you graduate, although you only | | | | most students have the same problem, and |
| need to repay money after you start | | | | because you are not paying interest the |
| earning above £15,000 per year, | | | | debt is not going to rise. You should |
| calculated on a monthly basis. The | | | | think of the student loans as an |
| amount you pay back will be taken out of | | | | investment in your future that will help |
| your wages just like tax, at a sliding | | | | you to achieve your career goals. |
| rate. You can also pay back more than | | | | |