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Postgraduate Loans: do you want one and are you elligable?

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Postgraduate loans are a relatively new option in the UK funding landscape. They have been available since 2016 for Masters, and are brand new this year (2018) for PhD students.

The loans are for UK students and (as of now) EU students. Masters Loans are up to £10,609 and PhD loans are £25,000. Repayments are 6% of annual income over £21,000 once you graduate, with interest charged at the Retail Price Index plus 3%. This new loans system represents amongst the biggest shakeup of the postgraduate funding system we've seen in a long time: a lot more money (albeit loaned money) will be available to most students and the number of students choosing to study for postgraduate degrees has correspondingly skyrocketed by 30%. For the latest developments on announcements regarding these loans, stay tuned to FindaMaster's excellent loans news page which seems to be the best news source on the loans.

 

Assuming I am eligable, do I actually want one?

While the loans are seemingly a boon, it's best to think hard before you take one out. To start with, you might ask yourself: do I want to get into any more debt than I am already in? With many students already emerging with £50,000 or more of undergraduate debt, this is not an easy decision. If you are happy to borrow more money, do also bear in mind that these loans are not enough to bankroll a whole course. The full Master's loan of £10,000 will probably take care of your fees, but it will only leave (at best) only a few thousand pounds for your maintenance, and so you will likely be at least £5,000-£7,000 short. For a PhD, the full loan will average £8,300 a year if your doctorate takes three years, and £6,250 a year if you take four. But the cost of study overall, when maintained is also factored in, will almost certainly be at least double this! You'll be able to pay for perhaps a year and a half. In addition, there are some more devils in the detail you should be aware of below...

      Devils in the Detail: Master's Loans

For Master's Loans, it is important to be aware of some additional details and restrictions which you might not immediately notice:

      1. You must be under 59 years of age.
2. The loan only works for a full masters degree, not to upgrade for PGCert or PGDip or PGCE (use Career Development Loans for these). Also, Masters courses supported can be no longer than 2 years full time or 4 years part time.
3. To be eligible as a UK student you must be ordinarily resident in the UK for three years before you begin your Masters. In addition, you must be most recently resident in England (as opposed to Scotland, Wales, or Northern Ireland).
4.  EU students must have been ordinarily resident in the EU, EEA or Switzerland for three years prior to their course. EEA and Swiss students must be resident in England and have been living in the UK for three years. This condition is likely to change after Brexit.

5. If other public funding is available, you may not be able to apply for a loan, this is why integrated Masters are not eligible (covered by undergraduate loan).
6. Postgraduate loans are only for English students based on English residency or EU nationals with EU residency. Scottish, Welsh, Northern Irish students who live in England can receive a loan. But otherwise the other nations of the UK have systems managed by their respective devolved administrations. Currently Northern Ireland offers up to £5,500, Wales £13,000 for full Masters course, and Scotland offers £10,000 for taught masters with separate schemes for fees and living costs.
7. They are paid in instalments 3 times a year.

Devils in the Detail: PhD Loans

Likewise, for PhD loans, you should bear in mind the following additional details and restrictions:

1. To be eligible, you must be resident in England if you are  a UK student. EU students are currently eligible (although again, this is likely to change after Brexit).
2. You must be under 59 years of age.
3. Your PhD must be between three and eight years long.
4. A particularly important detail is that the PhD loan cannot be combined with Research Council studentships, NHS funding, or other direct Government funding. This includes fees only studentships and PhDs funded as part of Doctoral Training Partnerships or a Doctoral Training Centre. Department studentships do not disqualify you, so long as they aren’t government studentships. If you aren't sure- check!
5. At present, if you have already started, you can't apply! So it won't be possible to take out the loan to cover a fourth year, for example.
6. To recap, the following groups aren't eligible: international students; EU students (after Brexit); UK students with full or partial government funding; UK national students who’ve lived abroad and don’t meet the residency requirements (i.e. have lived in England for last three years prior to PhD); UK national students whose home address isn’t in England; current UK and EU students (only for new students starting 2018/19); UK students who spend more than 50% of their time abroad.

If I can and want to take one out, how can the Alternative Guide help?

So if you do take advantage of the loans, you need to consider where the rest of the money is going to be coming from. It's here that the Alternative Guide can help you gain 'top up' funding using charities and trusts. One key advantage a loan gives you is that you now have a bona fide source of finance, and you are not entirely unfunded. Charities are much likelier to back a student who has another source of income (ideally from grants, savings, or part time work) but a loan from a respectable source, like this scheme, will also be acceptable. The loan will help reduce the gap between the money you have, and the money you need, and charity will probably be more likely to offer you the supplementary award you need to bridge the gap, than it might have done had your deficit been larger and beyond the charity's ability to meet.

While the loan might put you in a stronger position to gain charity funding, and indeed might encourage you to apply for a postgraduate course you otherwise might not have done, do be mindful, as you always should be when beginning a course with a deficit, that you are taking a risk. There is no guarantee other funding will emerge to supplement the loan, so having a backup plan is always sensible if top up funding from charity does not emerge.

 

For Staff: The Impact of Postgraduate Loans

Are you a staff member considering the impact of the new Postgraduate Loans system on students? If so, read our Postgraduate Loans Staff Statement!

 

·         Postgraduate loans of £10,609 for 2018-19 under age 60

·         Last no longer than 2 years full time or 4 years part time

·          

·         To be eligible as a UK student you must be ordinarily resident in the UK for three years before you begin your Masters. In addition, you must be most recently resident in England.

·          

·         EU students must have been ordinarily resident in the EU, EEA or Switzerland for three years prior to their course. EEA and Swiss students must be resident in England and have been living in the UK for three years. Likely to change after Brexit

·         Repayment at 6% of annual income over £21,000. Interest at RPI+3%.

·         Began in 2017-18, not means tested. Covered contribution of cost, for full cost of masters.

·         Money is leant by Student Loans Company on behalf of UK government.

·         For English resident students, managed by Student Finance England

·         If other public funding is available, you may not be able to apply for a loan, this is why integrated Masters are not eligible (covered by undergraduate loan).

·         Loan only works for a full masters degree, not to upgrade for PGCert or PGDip or PGCE (use career development loans for these)

·         Postgraduate loans are only for English students based on English residency or EU nationals with EU residency. Scottish, Welsh, NI students who live in England can receive a loan.

·         Paid in instalments 3 times a year

·         Students living in other parts of UK will be managed by their own system

·         NI offered £5,500 to up to Masters

·         Wales offers £13,000 for 2018-19 for full masters

·         Scotland offers £10,000 for taught masters with 2 separate schemes for fees and living costs