Student Loans 101

Many people leave high school and seek further tertiary education at a college or university. Some students who graduated with multiple distinctions are awarded with bursaries which pay entirely for, or supplement, their studies. rnOther less fortunate students are unable to meet the expensive enrolment fees into the course of their choice and are forced to take out a student loan to pay for their studies. Below are some common questions surrounding student loans: • What is a student loan? • Who offers student loans? • How do you get a student loan? • Who qualifies for a student loan? • Do you have to pay it back? • When do I pay my student loan back? • Is there interest affixed to the repayment?What is a student loan? A student loan is a loan which is awarded specifically towards the need of a scholar who wishes to attend a tertiary institute, but has no way of paying for it otherwise. Who offers student loans? Many banks and independent financial institutions offer student loan options. How do you get a student loan? You need to approach your bank or a financial institution that offers student loans and place a request with them. This will involve the signing of various forms and what quite often is the case is that they will require you to provide proof of enrolment to ensure your need for a student loan is legitimate. Who qualifies for a student loan? Anyone can qualify for a student loan and you are designated a specific student loan program depending on whether you are independent or still a dependent (i.e. Still depending on parental financing) etc. As mentioned above, you will be required to already have enrolled into a degree of study in order to validate your claim towards a student loan. Do you have to pay it back? Of course. As with any loan, you are borrowing money from a financial institution and are expected to pay it back. When do I have to pay my student loan back? You are expected to start paying your student loan back after a certain period of time after your course is complete. Depending on the type of student loan program you apply for, some institutions require repayment only after you start earning a salary in your first job, while other institutions simply give you a few months as a grace period before repayments are due. Is there interest affixed to the repayment? There will always be interest affixed to your loan repayments but depending on the type of loan program you have been granted and who granted it, that will decide whether you start accruing interest from the date the loan was issued or only after your studies are completed, or whether it is a fixed interest rate or a variable/increasing rate etc.