A quality education is the best gift that you’ll ever give your children. Unfortunately, it isn’t an affordable one! You’re a parent determined to send your child to varsity for a chance at a brighter future. How do you go about funding their new adventure? Student loans are one avenue to explore. Here are some things that you need to know…
What is a Student Loan?
You would take out a home loan to pay for a new house. A personal loan to fund home renovations or the cost of a new refrigerator. A student loan then is a loan that can pay for tuition fees, including various other associated costs at university. Usually, the parent and the student apply for the loan together. Paying it off in monthly increments over a period of about 10 years.
Does My Child Qualify for a Student Loan?
You and your child can apply for a student loan if he or she is a South African citizen or a permanent resident. And, earning more than R3000 per month. The loan can be in the name of anyone who can provide proof of income. This includes the university-bound student’s parent(s) or their guardian. Part-time students who work a full-time job and have proof of income can apply for the loan in their name. Some student loan providers will be willing to grant a student a loan and grant them a period of between 3 – 6 months after graduating to start paying it back.
Where Can I Apply for a Student Loan?
Most people will opt to apply for a student loan at a bank. All major banks in South Africa offer student loans. (Including FNB, ABSA, Nedbank, Capitec and Standard Bank).
Keen to weigh up your options and get the best deal possible? You might want to investigate other avenues too. For example, there’s a popular local loan provider called Fundi that many students swear by. It’s worthwhile to also look into the government’s National Student Financial Aid Scheme (NSFAS). This scheme allows students to apply for bursaries and other types of funding.
What Will I Need to Apply?
You’ll need both of your ID books. Recent payslips, it’s safer to take three months’ worth of payslips, as every institution’s policies differ — proof of address and proof of enrolment at a tertiary institution.
What is Surety?
If you’re applying for a student loan at a bank, you will also need to provide surety. Surety is a promise made by one party (the surety) to assume responsibility for the debt obligation of a borrower (in this case, the student). If the borrower cannot settle his or her debt as per the terms laid out in the contract, the person standing surety will need to pay. At the end of the day, while finding (and paying off) student funding can be a challenge, it’s certain to be worth it in the end.
Malcolm X once said, “Education is the passport to the future, for tomorrow belongs to those who prepare for it today”.