The govt. gives loans to the students who cannot afford their education on their own. The rate of interest is very low. Student loans come at a very low interest rate. The rate of interest varies with inflation and hence interest rate comes at 1% above base rates and the loan grows, are a very good advantage. The interest rate varies from 5.6% to 6.3%.
There are two types of loans - secured and unsecured. For a secured loan, the family house is kept as security deposit and the rates of interest are low, while for an unsecured loan, the interest rate is little high.
Qualifications:
They have a criterion to whom they can give a loan and to whom they cannot.
Students from a family earning
&bullLess than ?22,010 do not have to pay any fee.
&bullBetween ?22,010 and ?32,744 receive some aid.
&bullMore than ?32,000 have to pay the full fees.
&bullLess then ?15,580 get a ?1,000 every year.
&bullAll students can apply for a maximum govt. student loan of ?5,175 yearly for their study period.
&bullDisabled and dependent students get additional help.
&bull?3,000 can be borrowed by any new student regardless of the financial status.
Student loan instalments are directly transferred to the bank account and a cheque is also given. Repayment of the loan starts only after the student starts earning more than ?15,000. The best part about a govt. student loan plan is that the student does not have to worry about anything during his academic life. No extra job is required for earning, which helps a student get better grades. A govt. student loan is therefore given according to the financial needs of the students' family. The repayment options make it very easy for a student to pay back his loan amount.
Summary
Government provides loans for student who somehow doesn't manage money for completion of their higher education. It comes at very small rate. The best part about a govt. student loan plan is that the student does not have to worry about anything during his academic life.
