Most students have to take out loans in order to afford tuition and basic living costs while studying at university. The good news is that for most people is that it will be the cheapest long term debt they will ever acquire due to the fact that interest rates and other miscellaneous charges are usually reduced for student loans.
Student loans are provided by the Government through the SLC or Student Loans Company. While you can get a personal loan to pay for education costs, a student loan is the much more advantageous way to go because the interest rate is set at the inflation rate and sometimes even lower. At the moment in fact all student loans are interest free for this school year.
The first question that most students want to know is how much they can borrow, or how much money the government will allocate to them. There are several factors that are weighed by the government in this regard, including on the income of your parents and your income if you are over the age of 25, or if you have a child, or have supported yourself for the last three years previous to your application for aid.
There are also student loans awarded to students that are part time, which are also based on household income and the intensity of the coursework. The maximum amount you can be awarded as a part time student however is £500 to £1,470 depending on where you live in the UK.
How you apply for student loans from the government differs by where you live. Students in England apply through the Student Finance England organization, students from Scotland apply through the Student Awards Agency, students from Wales apply through the Student Finance Wales organization, students from Northern Ireland apply through Student Finance NI, and students from other areas in the UK should look for direction from the DirectGov website.
In general, students can apply for two different types of student loans, the receipt of which will depend on their total income or parent’s income- tuition fees loan and maintenance loan.
The tuition fees loan is exactly what it sounds like, it is a loan to cover your tuition costs and is usually paid to the college or university directly, so after the initial application there is nothing left for you to complete.
The maintenance loan is provided for any full time student that is aged under 60 and needs help with basic associated living costs of attending university. The loan is disbursed in three different instalments at the beginning of each term.
There are two parts of the maintenance loan: the guaranteed bit, which makes up 75% of the available loan money which everyone receives. The second part is the income assessed bit, which like the tuition fees loan is assessed based on the residual income that is calculated when your student loan amounts are initially calculated.