You will need to seek out alternative means of funding if you want to go to university but neither you nor your parents have the money for it on hand. In these instances, apart from applying for scholarships and bursaries, the most convenient option available to you will be to apply for a student loan from one of the banks. Here is what you need to know, along with the questions that you should ask before going for it.
What is a student loan and what does it cover?
A student loan is a specific type of loan with various restrictions granted to an individual who wishes to further their education. It will usually cover the actual course fees associated with their chosen degree, as well as other necessities for varsity, such as textbooks, stationery, and digz.
What will I need to apply?
The various documents and pieces of info required will vary from bank to bank. Some banks, such as ABSA, will require that you bring proof of the fact that you have a part-time job and that you are earning a minimum monthly income of R3 000. Other banks, like Standard Bank, insist that you bring someone along who is willing to sign as surety on your behalf (usually one of your parents).
When do I need to pay back the loan?
You will only need to worry about repaying your loan once you have completed your studies. However, you or your surety will be required to pay back the interest on a monthly basis while you are still at varsity.
The questions to ask
There are a few important questions to ask before signing on the dotted line and officially taking out a student loan:
- Do I qualify for free higher education? You may be eligible for free higher education through the National Student Financial Aid Scheme (NFSAS) if you are a South African student studying a full-time undergraduate degree and with a household income of less than R350 000 a year.
- How much interest will I pay? The short answer is a significant amount. This is because your loan starts accumulating interest immediately. Try to keep these numbers to a minimum by requesting a fixed interest rate.
- Are there restrictions on where I can study? Not really. Banks will usually offer their student loans for those studying at either public or private institutions. Some also offer loans to students who are studying through online learning institutions.
So, do your research and never make a snap decision when it comes to any form of student funding. This definitely isn’t a decision that you want to take lightly. Speak to a financial advisor if you need some extra guidance.