Student Loans

If you are wanting to take on full time further education it almost goes without saying that you will be applying for some form of financial assistance, normaly in the form of a loan.

You will not have to begin making repayments until you are in full-time employment earning a salary over a certain threshold after you leave university.

The repayment is usually made in monthly instalments, with a fixed percentage of your monthly income being deducted by your employer and paid to the financial institution who issued the borrowed sum. The interest rate charged is normally low compared to other standard forms of borrowing. Some finance providers will write off any debt that still exists in your name after you reach a certain age, or if you die before the whole sum of money has been repaid. Student credit cards issued on behalf of high street banks often offer incentives to use the card such as vouchers and travel insurance cover.

Government Loans

To successfully apply for a student loan you must generally have been resident in the British Isles for the three years immediately before the start of the academic year of the start of your course. There are some exceptions and these should be discussed with the college or university you will be attending.

The loans are part of the Government's financial support package for students carrying out a course of Higher Education Interest is linked to the rate of inflation, so that in real terms the total amount borrowers repay is equivalent to the amount they have borrowed. The rate at which borrowers repay their loans depends on the level of their income. The loan is intended to help students meet their basic living costs.

The interest rate is linked to the rate of inflation. The interest rate from 1st September 2004 to 31st August 2005 will be 2.6% Interest accrues from the day you receive the first payment. Colleges receive access funds so that they can provide discretionary help to certain students who have serious financial difficulties. To find out more, contact the Student Loans Officer at your college or university.

To calculate how much you will receive from your student loan and how much your parents have to contribute, your LEA works out your parents' residual income.

It does this by taking their gross income (before tax and National Insurance) and taking off allowances for the following:

• A dependent adult who is not their husband or wife, where that dependant's residual income is less than £2,415.
• Parents' pension scheme and superannuation payments that qualify for tax relief.
• The cost of wages to a domestic help where this is required because of disability.
• Living abroad, if your parents live outside the United Kingdom in a country where the cost of living is higher than in the UK.
• A parent who is also a student.
• Once your LEA has taken away the right amounts and worked out your parents' residual income, they decide on your parents' contribution according to the following calculation.
• No contribution if their income is less than £20,970.
• £45 if their residual income is £20,970
• An additional £1 for every £9.50 of residual income over £20,970.

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Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.

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Registered Address: 98 Station Road, Sidcup, Kent, DA15 7BY.
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