UCAS Students: Student loans

Find out more about student loans

Student maintenance loans - 2008 entry

What is a student loan?

The purpose of student loans from the government are to help cover the costs of your tuition fees, and basic living costs (rent, bills, food etc). Two types are available: tuition fee loans, and living cost loans. Many other kinds of loan are available to students whilst they are studying at university or college. Depending on the source of the loan, the interest rate can have a severe impact upon the overall debt at the end of your degree. However, the interest rate on a government student loan only takes inflation into account, so the overall amount will, in real terms, be the same as the amount borrowed.

Both types of student loan are available to all students who meet the basic eligibility requirements. Find out more information from www.direct.gov.uk or you can contact the Student Loans Company for more information.

Does everyone have to get a loan?

No. If you do not need extra financial assistance, you don't have to apply for student loans. If you do apply, remember that they are not grants: you do have to pay it back, but not until you have finished your course and are earning over £15,000. If you do want to take out a student loan, you can apply for this and the other help available online at www.direct.gov.uk/studentfinance, or you can contact your local authority for a paper application. Find contact details for your local authority

Is there an age limit for applying?

Student loans for tuition fees are available to all eligible students and, if you live in England or Wales and are aged under 60, you can apply for a student loan for living costs. In Scotland you need to be aged under 50 or aged 50-54 planning to work after your course.

What am I entitled to?

For tuition fee loans, you can apply for any amount up to the full cost of fees that you are charged. This loan is paid straight to your university or college, and it does not depend on income.

For living cost loans the amount you are entitled to depends on your income or your parents' or partners income; whether you will be living at your parents' home, and if you will be studying in or outside London.

In 2007/08, students living away from home and studying in London could get a maximum living costs loan of £6,315. Students living away from home and studying outside London could get up to £4,510, whilst students who live at home with their parents could get up to £3,495. It is important to remember that the final academic year of a course is viewed as having fewer weeks than previous years, which include the need for financial assistance during summer holidays, so the loan will be lower in your final year.

How do I get it?

Depending on where you live, your application will be processed either by your local authority or the Student Loans Company. You can apply by paper or online. Once your application has been processed, you will get a letter telling you how much you will receive. Payment is normally paid directly into your bank account in three instalments - one at the beginning of each term (but remember that it may take a few days for the payment to reach your account, so make sure you have enough money for the first few days).

Entitlement is assessed each year, so you must remember to reapply every year of your course.

As it can be quite a long process, it is important to apply early. The deadline for new students is the end of June, so the sooner you can apply, the better. Applications after June are still processed, but you may not get the first instalment in time for the start of your course.

When do I have to pay it back?

The loan has to be paid back once you have finished your course and are earning more than £15,000 a year. Repayment usually begins at the start of the following financial year (the April after you have finished your course, if you are earning enough). However, if you are due to start repaying your student loan on or after April 2012, you may be entitled to defer your loan repayments for up to five years. Further information is available on the Direct Gov website.

When you are required to repay your loan, your employer will be notified about your loan repayment and it will be taken from your earnings at the same time as tax and National Insurance Contributions (NICs) are deducted. Student loan repayments are not a deduction for tax or NICs purposes.