- Higher education costs in the UK
- Student finance – the basics
- UCAS and student finance
- Are student loans hard to get?
- Applying for student loans – step by step
- Applying for student loans from each constituent country
- Implicit parental support
Applying for financial support as a student in the UK can be complicated and confusing at times. The best way to support your child while they are applying for student loans is to get familiar with the process, eligibility and deadlines ahead of time. Check out our helpful ‘student finance for parents’ guide and let us answer all your student finance questions. 🙋
Higher education costs in the UK
Tuition fees are part and parcel of the student experience for young people in the UK today. So, you may be surprised to learn that between 1962 and the 1990s higher education in Britain was effectively free, as the state paid students' tuition fees and offered maintenance grants on top.
Tuition fees were first introduced across the entire United Kingdom in 1998 to fund tuition for undergraduate and postgraduate students at universities – students were required to pay up to £1,000 a year for tuition. Since then, we have seen tuition fees steadily increase with yearly fees at the average university now costing £9,250 for an undergraduate degree. 💷
Furthermore, research from personal finance comparison site finder.com revealed that the UK is the fifth most expensive destination for students to study in the world – according to their figures, UK students are paying a staggering four times more than their European counterparts. The British political system and COVID-19 have also made their mark on the student experience in the last few years.
So, with higher education expenses at an all-time high, understanding the UK’s student finance system, what support may be available for your child and how to tackle applying for student loans is more important than ever.
Student finance – the basics
Student Finance is the official government funding your child can apply for in order to pay for their university tuition fees or living costs while studying. The financial support is backed and regulated by the government and administered by a different student finance body depending on your child’s location.
UK universities are among the best in the world but there are some differences between studying in England, Scotland, Wales and Northern Ireland when it comes to applying for student loans – most notably, students living in Scotland choosing to study full-time at a Scottish university or college do not have to pay tuition fees – there are some fundamentals that apply to all constituent countries, however. Student finance in the UK can be simplified and split into three main strands: 👇
- Tuition Fee Loans
Tuition Fee Loans cover the full cost of your child’s course, are paid directly to the course provider and are not repayable until after their course, when they’re earning above a certain level.
Maintenance Loans can be applied for at the same time, lending your child money at the start of each term (or monthly in Scotland). Maintenance Loans are partly means-tested. Everyone eligible can get some of it regardless of their financial situation, but to get the full allowance, you'll need to declare household income.
Maintenance Loans are paid directly to the student’s bank account and are not repayable until after their course when they’re earning above a certain level.
Maintenance or Special Support Grants
Maintenance Grants are available to help with living costs, they’re means-tested and paid directly to the student’s bank account at the start of each term. Maintenance grants are not repayable but any funds your child gets will reduce the Maintenance Loan they can get.
Students applying for student loans can also apply for Special Support Grants if they’re eligible for certain benefits, disabled, or need help with childcare costs. The amount your child would get is the same as the Maintenance Grant, but it will not reduce the Maintenance Loan they can get.
UCAS and student finance
The Universities and Colleges Admissions Service (UCAS) is a UK-based organisation whose main role is to operate the application process for British universities. With a database of almost every UK University and course, UCAS manages all key information about your child’s current education and university applications in one place online.
In most instances, if your child is planning to study at a university in the UK they will need to make their application through UCAS. If your child is applying for student loans, they should submit their application through the relevant student finance body as early as possible. This might mean applying before they have a confirmed place at university or college via UCAS. 🧑🎓
Are student loans hard to get?
How are students applying for student loans in the UK? And is it difficult to do? Whether your child qualifies for student finance will depend on their university or college, their course, if they’ve studied a higher education course before, their age, and their nationality or residency status.
Thankfully, any UK or EU citizen can apply for a tuition fee loan to study at a UK university as long as they have been living in the UK or EU for the past three years with citizenship or pre-settled status. More detailed eligibility criteria and easy-to-follow online application portals can be found on the GOV.UK website. ℹ️
Applying for student loans – step by step
Your child should be applying for student loans and grants as early as possible to make sure they get their student finance in time for the start of their course. Applications for student finance open in the spring before your child’s course starts.
They can apply as late as nine months after starting their course but we wouldn’t recommend this as it will mean self-funding in the first instance – especially given the four to six week processing time required. Remember, your child will need to reapply for funding each year of their course. ⌛
The general application and repayment process follows seven easy steps. These simple steps will take your child right through from deciding which strands of financial support to apply for to repayment after graduation.
#1 Check eligibility
Most students in the UK are eligible to make an application for student financial support. Whether your child qualifies for student finance will depend on their university or college, their course, if they’ve studied a higher education course before, their age and their nationality or residency status.
The eligibility criteria vary slightly between constituent countries so you will need to check the website of the relevant funding body for exact details. 📍
#2 Crunch the numbers
Find out exactly how much money your child is eligible to receive. Remember, when applying for student loans, there are three types of funding available – Tuition Fee Loan, Maintenance Loan and Maintenance or Special Support Grants – each with slightly different criteria, deposit and repayment arrangements.
The maximum support your child will receive is also dependent on whether they are a new full-time student, a continuing full-time student, a part-time student, an EU student, or a student who started before 1 September 2012. Make use of the student finance calculators available via the relevant student finance body websites and find out how much your child will repay at this stage too. 🧮
#3 Prepare application
Applications for student finance open in the spring before your child’s course starts. We recommend starting as early as possible to make sure your child receives support before the start of their course. Make sure your child has the correct ID available – preferably a valid UK passport but failing that, their original birth or adoption certificate will be required.
If they have applied for a Maintenance Loan or a Maintenance or Special Support Grant then you will need to support their application with evidence. You will receive an email with a link to create an online account or log in. From there you can provide information about your income in the previous tax year and send supporting evidence. 🛂
#4 Apply online
Applications for student financial support are made online via the appropriate student finance body – Student Finance England (SFE), Student Awards Agency Scotland (SAAS), Student Finance Wales (SFW) or Student Finance Northern Ireland (SFNI). Remember, it can take up to six weeks for your child’s application to be processed. 💻
#5 Update details
If your child has made their student finance application early in the year, they may find that they need to update their applications as plans change in the intervening months between submitting and starting at university or college. Your child’s student finance account will need to be kept up to date for the duration of their study period with new applications for loans and grants required every year.
Applying for student loans is an ongoing process and it’s important that your child keeps their details up to date. If they change their course through clearing or where they're going to live – perhaps they decide to stay living at home rather than move into halls of accommodation – they just need to login to their student finance account and make the updates online. ✍️
#6 Create an SLC account
When your child stops studying the Student Loans Company (SLC) will automatically create a student loans repayment account for them. They will need to make sure that their contact details are up to date in their repayment account. The login details will be the same as for their student finance account. 🔒
Repayments will depend on which plan your child is on and which part of the UK you live in. As detailed on the SLC website, Plan 1 is applicable for all students including those English or Welsh students who began their course on or before 1 September 2012. Plan 2 is applicable for English or Welsh students who started an undergraduate course after 1 September 2012.
Remember, Maintenance or Special Support Grants are nonrepayable and Tuition Fee and Maintenance Loans will expire after 30 years. Your child will need to let SLC know if they leave the UK for more than three months or change their employment details. Knowing the applicable repayment details will help your child to navigate the repayment process when they graduate. 💰
Applying for student loans from each constituent country
According to Statistica, in 2021, students graduating from English universities will have incurred an average of over £45,000 of student loan debt, compared with £27,600 Wales, £24,700 in Northern Ireland and around £15,200 in Scotland. 🇬🇧
We recommend referring to GOV.UK, UCAS student finance pages and the relevant funding body websites for the latest information. In the meantime, as the process of applying for student loans differs slightly between constituent countries, we have broken down some of the details below.
The Tuition Fee Loan is paid directly to the university whereas Maintenance Loans or Special Support Grants are paid directly into your child’s bank account at the start of term. Both loans are repayable and the Maintenance Loan is part means-tested, the grants are nonrepayable. 🏴
If your child lives in Scotland and chooses to study full-time at a Scottish university or college, they will not have to pay tuition fees. However, they will need to apply to SAAS to have their tuition fees paid for them, as this is not automatic. Maintenance Loans or Special Support Grants are means-tested and paid directly into your child’s bank account on a monthly basis.
Scottish students who wish to study elsewhere in the UK will be charged the standard tuition fees for their chosen course provider but may apply for a loan to cover the costs through SAAS. 🏴
Applications for student financial support are made through Student Finance Wales.
The Tuition Fee Loan is paid directly to the university whereas Maintenance Loans or Special Support Grants are paid directly into your child’s bank account.
All eligible students will receive £1,000 a year for accommodation and living costs. Students may also be eligible for an additional means-tested maintenance grant. Students who do not receive a full grant will also be able to apply for a Maintenance Loan. This is repayable and the amount depends on where your child will be living. 🏴
Applications for student financial support are made through Student Finance NI.
For students who live in Northern Ireland and choose to study at a Northern Irish course provider, the maximum tuition fee is capped and they can apply for a Tuition Fee Loan to cover this cost. Likewise, if they choose to study elsewhere in the UK, they may apply for a tuition fee loan, but the costs will be higher. This loan is repayable.
Maintenance Loans are paid directly into your child’s bank account at the start of the term. Both loans are repayable and the Maintenance Loan is means-tested. Maintenance or Special Support Grants are also means-tested. Your child can apply for either grant but not both, so check which is best for them. ☘️
Implicit parental support
In recent years various media outlets and online funding advisors have called for more transparency around the implicit expectation that parents will contribute financially to their child’s university or college costs. 🎓
As the Maintenance Loan is means-tested and based on ‘household income’, the amount your child receives is directly related to your income. If you are a high-income family then, when applying for student loans, your child will not be eligible to receive the full amount based on the assumption that you as a parent are in a position to make up for that shortfall via your own income.
Thankfully, the Government has accepted this needs to be made clear to students and parents and the SLC has agreed to update its website accordingly in time for when you and your child apply for student finance 2022/23 academic year. Martin Lewis at MoneySavingExpert has also created a bespoke calculator to help you determine just how much you may be expected to contribute to your child’s higher education.
Of course, the amount of money you feel you are able to contribute to your child’s overall costs is a matter for you to decide, some parents refuse to support student finance at all, but at least if you understand what amount is expected then you can have an open conversation with your family, create a budget and agree on how to approach applying for student loans together. 🤝