Masters Loan Scheme - What you need to know
By Fiona Menzies
The announcement of the Masters Loan Scheme was welcome news amongst students across the country. Gone are the days of desperately and disastrously trying to fund your way through a postgrad with a combination of credit cards, overdrafts and personal loans. Like with any new government initiative, however, details can be perplexing so we have put together this little article to help clear confusions up.
What exactly is it?
The loan will become available from autumn 2016, for the academic year 2016-2017. You will be able to borrow up to £10,000 to go towards the cost of a master’s. It will be paid directly to you, in instalments during your course (the standard being 3 instalments over a 1 year course). You can choose to spend the money as you please either as contribution towards fees, or for other study or living costs during the master's course (be sensible, stop booking those plane tickets to Dubai right now).
Who is it for?
To be eligible for the loan you must be a UK National, or have settled status in the UK, and have been resident in the UK for three years on the first day of the academic year of your course start date. Your residency must have been in England so you must not have just moved to England from elsewhere in the UK and Islands in order to undertake the course. However if you have been resident in England you can use your postgraduate loan to study for a master's course in Wales, Scotland or Northern Ireland. If you are a UK national, or have settled status or leave to remain in the UK but you ordinarily live outside England (for example in Scotland, Wales or Northern Ireland) then you are not eligible. Other EU nationals, and those with refugee status, may also be eligible.
The originally proposed age cap of 30 no longer applies and the loan is now available to people under the age of 60 (sorry mum, and a Happy 61st Birthday to you). If you already have a master's level qualification, or equivalent level qualification, or a higher level qualification, such as a PhD, you will not be eligible. The loan is not means tested so anyone from any economic background (obviously meeting the above criteria) can apply.
What courses does it cover?
The loan is for a master's qualification which is classed as either a taught, research, or professional master's (for example, MA, MSc, LLM, MBA, MRes, MEd, MMus, MDes etc). Courses like postgraduate diplomas or certificates, including PGCE, or a graduate certificate, that are lower than a full master's level, are not covered by the loan. The loan only covers full-time master’s courses or a course that is 50% part time (for example a 1 year course spread over two years). Both campus based and online courses are covered by the loan, as long as the course is delivered by an officially funded institution in the UK (Somewhere that has taught degree awarding powers).
When will I have to pay it back?
You won't have to start repayments until the April after you complete your course and you only have to make repayments when your income hits £21,000. If you already have an outstanding undergraduate loan, you will have to pay the postgraduate loan off at the same time. Interest on the loan is calculated from the date when you receive the first loan instalment. It is calculated at RPI+3%, and the repayment rate (once you start repayments) is at 6% of your income (above the £21,000 threshold). If you leave your master's part way through or move to another course which is not covered by the loan, you will be liable for all repayments.