In the Autumn Statement 2015, the Chancellor announced that new master’s students would be eligible for loans to help pay their tuition fees. Students up to the age of 60 can apply for the loan through the Student Loans Company and receive a maximum of £10,000 towards their studies.
Before the changes come into effect on 1st August, we’re going to run you through the details.
The postgraduate loan is available for students starting any master’s course from August onwards. Students already enrolled on a master’s course won’t be eligible.
You must be under the age of 60 to apply and a UK national living in England. If you’re an EU citizen, you can get this loan as long as you’ve been living in the EU for the past three years.
The master’s course you’re enrolling on must be your first master’s degree and amount to a level 7 qualification worth 180 credits (a full master’s course). You can either study full or part-time, but part-time courses must last no longer than four years.
How much can you borrow?
The maximum loan you can take out is £10,000, although you don’t have to borrow the full amount. The average master’s course fee is around £8,000, so this figure will cover your tuition and leave a little left over for other expenses.
If the master’s course you’re looking at costs more than £10,000, you will have to fund the rest yourself. Unlike undergraduate loans, the tuition fees will be paid directly to you and not straight to the university – so you’ll have to manage the payments yourself. The loan will be paid in three instalments.
When do you start to repay the amount?
You can start repaying the loan in the April that follows the end of your course – so if you finish in July, you could start repaying the following April. As the system is still being set up, the first payments won’t be taken until 2019. This means that you’ll have an extra year to start repaying if you start a one-year course this year.
The threshold for these repayments is £21,000 a year (equivalent to £1,750 a month). You’ll repay interest of 6% on whatever you earn over this figure. If you never earn more than £21,000, you won’t have to repay anything.
Still paying off your undergraduate student loan? You’ll keep repaying this alongside your postgraduate loan if you earn over the repayment threshold. You’ll accrue interest on both of these loans.
Although the postgraduate loans are set to come in this August, the final regulations are still being sorted out so be aware that the details could change.