Most students planning to go to university can borrow money to pay for their fees and living costs. The amount you receive will depend on your household income, where you live and what you study.
The student finance package includes:
- Tuition fee loan: A non-means tested (not dependent on household income)
loan, available for UK or EU full-and part- time students (see page 2 for eligibility requirements).
- Maintenance loan: A means-tested loan for full-time UK students to help
cover living costs, such as rent, food, books, travel etc.
- Advanced learner loan: A non means-tested loan available to students aged 19 and over, studying eligible courses from Level 3 (A-level equivalent) to Level 6.
How maintenance loans work
This helps support students with living expenses while at university, such as accommodation, food and course materials.
What is it based on?
The loan you receive takes into account where you will be studying and how much your parents earn, amongst other factors. Many students will not receive the full amount outlined below, meaning either you, or your parents, should be prepared to make up any financial shortfall.
How to apply for loans
If you are a student from England you can apply for student loans and grants online by visiting the student finance section in GOV.UK. Students from Wales, Scotland or Northern Ireland can use the links in the resources box on page 3. Get your application in early – you don’t even need to wait until you receive offers back from universities to get this started.
|Where are you living and studying?||Maximum maintenance loan|
|Living with parents||Up to £7,324|
|Living away from home outside of London||Up to £8,700|
|Living away from home in London||Up to £11,354|
Deadlines for applying
The deadlines for tuition fee loan and maintenance loan applications depend on where you live, rather than where you study, and range from mid-April to the end of June.
Make sure you’ve completed your funding application in plenty of time to receive your first instalment by September. However, if you do miss the deadline you can apply up to nine months after your course starts
When do I have to repay my loans?
It may feel daunting to think about repayments, but student finance loans only need to be repaid once you’ve finished or left your course and are earning more than £25,000 a year, £2,083 a month or £480 per week (this has been frozen until at least April 2021).
You pay interest on your loan from the day you receive it until the loan is fully paid or written off. The level of interest depends on the current UK Retail Price Index (RPI). If you leave or suspend your course, you’ll still be expected to repay any loan money you received.
How do I pay it back?
You don’t physically hand any money over – your employer takes 9% of your income above the £25,000 threshold through the UK tax system (Pay As You Earn – PAYE) If you are self-employed you will pay it back via HMRC’s self-assessment scheme. The amount you pay back is calculated on your pre-tax income above £25,000 and will be taken after you’ve paid tax.
If you usually earn less than this, but bonuses or overtime take you over this amount, the Student Loans Company (SLC) will still take 9% of anything above £1,750 from that month’s salary. If you go on to earn less, your repayments will automatically stop.
While the loans do accrue interest, any outstanding debt still owed after 30 years in England and Wales is written off, meaning it’s not always worth paying back a loan early. Student loans won’t appear on your credit file either.
It’s important to keep track of your repayments through P60 forms and payslips or by logging onto www.studentloanrepayment.co.uk.
If you are just a few years away from paying it off, you can set up a direct debit to avoid being overcharged giving you more control over your money.
How much will I actually pay?
To give you a quick idea, if you are earning £29,000 a year, you are £4,000 over the repayment threshold. You will pay 9% on this amount, which is equal to £30 a month.
For more in-depth advice on all things student finance, head to www.which.co.uk/student-finance-advice