Your Finances

Obtaining student grants for fees and living costs has become increasingly difficult, and so most students look toward as the main source of income. The loans are given out as additional support to substitute the limited amount of available. They can be used for help with costs, such as , rent, food, books, etc.

However, you must note that any information provided here on only affects students who have entered higher education after September 1998.

As stated previously, the Student Loan instead of the Local Education Authority () maintenance grants will support students starting higher education from the academic year 1998 onwards. The provide students with these student loans, and offer them at near interest free rates. No other place will allow money to be borrowed at such low rates (apart from parents) - and generally it is this, coupled with the fact that studying cost so much, that attracts many student into taking out student loans.

You must note that although money can be borrowed in each academic year, it must be repaid once you have completed studying in monthly instalments.

If you a have been a resident in the UK for at least 3 years, and are aged 50 or under, you can apply for a loan but it must be applied for before you start your course at University.

However, if you are completing a course (other than the Postgraduate Certificate in Education) or a Nursing/Midwifery course, you are not eligible for a Student Loan.

If a part-time course is taken up, a loan can only be applied for if the course is at least half of what a normal full-time course would cost. Sometimes it may even be possible to apply for a loan up to £500.

Students in England and Wales need to contact the to apply for a student loan, even though the Student Loans Company () administers the loan. Applications are processed by the SLC but are subject to approval by the LEA. Students in Scotland should apply to the .

Due to the recent policy changes, all eligible students can now claim 75% of their maximum allocation regardless of their parents or their own financial situation. Subject to assessment, the additional 25% will be offered. This is assessed by the LEA (who you send your application to), and then processed by the SLC.

If you want to ensure that your cheque arrives to you at the beginning of October, you should make sure that you return the income assessment forms to the LEA by early May but you should still contact your LEA for confirmation of dates.

Repeat student loans, or new loans for existing students, will be administered through the .

1. Obtain the assessment forms by contacting your LEA.
2. Return the forms to your LEA after completing and ensuring that all relevant questions are answered.
3. Your LEA will complete the income assessment and will send you a Financial Notification, which advises you of how much you are entitled to.
4. You will receive three copies of the form: one for your records; one for your University; and the final one acts as your .
5. After receiving your forms from your LEA, you should complete all relevant parts, and send it back to the SLC. The form should show the amount that you are borrowing and the number of instalments.

   You should note that in any one academic year, you do not have to apply for the maximum allotment, and can apply for any amount up to the maximum allocation. You can first apply for a smaller amount, and then later apply again for a second request.

6. After the SLC have processed your application, they will send you the amount you requested in three instalments but you can also apply for the entire amount in one instalment.

   You should fill in all forms as quickly as possible to ensure that you get your cheque at the start of the term. However, do not wait until your exam results, even if you do have any change in circumstances, you can always cancel your loan later.

This is dependent on two factors that the LEA decide through assessment - firstly how much is the maximum amount you are entitled to and whether you are entitled to the full amount.

This depends on the following factors:

• Is your University in London?
  A higher rate is available to you if you study within the London region.

• Are you living away from home?
  If you are living in rented accommodation whether it is on- or off-campus can apply for a higher amount.

• Is this your final year?
  In the final year of a course the maximum loan to which you will be entitled is lower, as the loan does not provide support for the summer holiday weeks prior to the next academic year.

• Will you be on a this academic year?
  If you are completing two placements, you will still be eligible for a loan entitlement over the period. If you are on a full placement year in your third year, you will not be eligible to apply for a loan.

According to the outcome of these questions, the LEA will establish the maximum amount that you can be offered. These figures below are for the academic year 2002/2003:

Living away from home, studying in London	Maximum	75%
First Year	£4,815	£3,610
Second Year	£4,815	£3,610
Final Year	£4,175	£3,130
Living away from home, studying outside London	Maximum	75%
First Year	£3,905	£2,930
Second Year	£3,905	£2,930
Final Year	£3,390	£2,545
Living at home	Maximum	75%
First Year	£3,090	£2,320
Second Year	£3,090	£2,320
Final Year	£2,700	£2,020

You can also apply for a further amount to cover any additional weeks that you partake your course, above the average 30 weeks per term (as well as any short breaks). If you partake in a course that is 45 weeks or longer, you will get an amount that is equivalent to a 52-week loan. The maximum amount that you can be offered per extra week is £86 for London, £65 for elsewhere, and a rate of £45 for living at home.

The assessment made by the LEA will decide whether you are eligible for the additional 25% of the maximum amount and this is dependent on your parents' residual income. As a rough guideline, if your parents' income is more than £30,502, then they may be expected to contribute by the LEA. This amount is on a sliding scale ranging from £28,505 to £36,405, where the maximum amount will be £1,100.

However these figures are only to be used as guidance, and the amount may change if your parents are supporting a number of dependants under the age of 18 or who are in Higher Education.

Student loans can be paid in either three instalment (where the payments are spread across each term) or as one lump sum but you should be aware that the first option allows you to plan your finances better.

Your first cheque (be it your only cheque or one of three) will be paid to your University Finance Office. The rest of the payments will be made straight to your bank or building society account.

You repay your loan after you finish your studies, but your repayments are not expected until your income reaches £10,000. Generally these repayments only start the April after graduation when you have crossed the £10,000 mark (or £835 a month) and you will be repaying at a rate of roughly 9% on any earnings above this amount. If your earnings are less than £10,000 a year, your repayments are suspended until you do reach this amount.

In conjunction with the SLC the will collect the repayments. The Inland Revenue will instruct your employers and your payslip will show the deduction.

The table below summarises the amount of monthly repayments that you will be making on various incomes.

Income each year	Monthly payment
Up to £10,000	Nil
£15,000	£37
£20,000	£75

These monthly repayments will continue until the full amount has been paid.

The amount of interest you pay on your loan adjusts with inflation. It is calculated using the Retail Price Index (). In other words, the value of the amount that needs to be repaid is in real terms the same as the amount that was given to you in the loan. This is true for the complete time that you repay the amount. As an example of the interest rates charged, the Annual Percentage Rate () for the year starting September 2000 is 2.6%

This link to the RPI makes it unlikely for the rates to alter significantly, and this is even true for some students who take up to 10 years to pay off their debt.

Contact your for any specific queries about the process and the amounts available to be borrowed, or alternatively you can visit the Student Loans Company website.