Private Student Loans from UK Direct Lenders
£50 – £5000
Representative 277.5% APR Representative Example: Borrow £700 and pay £111.27 per month for 12 months at an interest rate of 140% per annum (fixed). The total charge for credit is £635.24 The total amount repayable is £1335.24. Representative 277.5% APR (variable). Your APR rate will be based on your circumstances.
If you’re a student you’re probably used to feeling a bit skint. You’re not alone, it comes with the territory. We know, we’ve been there too! Although we’re amazed that so many student’s struggle with money without realising how much help is available to them.
If you’re a student or are planning on becoming a student, you probably know about student loans. These are lumps of money that are paid into our bank account at the start of every term. They then need to last until the next one, but many students have a part time job, grants and family members to also fall back on when times get hard.
Some students are eligible for large student loans from the government, but other people may only be able to borrow a smaller amount. The amount you can borrow from Student Finance England depends on your circumstances and is governed by a range of different factors, but we’re not going to go into what they are today. Instead we’re going to tell you about another avenue of support that will be open to you – Private Student Loans.
How are these different to regular student loans?
That’s a good question but the clues in the name. While regular student loans come from the government, and once they’re gone, they’re gone for good! Private student loans are provided by private lenders.
There’s a range of private loan lenders out there. Some are traditional lenders like banks, building societies, credit card companies etc. While others are specialist payday loans for student or companies specially set up to cater for students. But the thing that separates from regular student loans is they are not provided by the government.
But that’s a good thing, because it’s possible to enjoy the benefits of both, at the same time! For example, you could enter a term and receive your regular student loan payment, but you’re also free to apply for a private loan too, if you like. There is no connection between the two and having one does not impact getting the other. The only requirement is that you’re a full or part time student.
Benefits of a Private Student Loan
As we said earlier, you need to be officially listed as a student to apply for a private student loan. That means they are not available to everyone. For example, your older brother/sister who graduated several years ago is no longer eligible to apply for one. Instead they will be made to apply for the average adult loans’ and pay adult rates at that!
One of the main advantages of private student loans is, like regular student loans, they have incredibly low interest rates when compared to normal loans. This is to make it easier for students to pay them back. They are also extra lenient and relaxed in terms of repayment. Like regular student loans, many private lenders won’t expect you to pay them back until the borrower is in gainful employment.
So if you’re someone who’s accrued some debt, then become a student, consider a private student loan to consolidate and move your debt. Take advantage of being a student and use the student loan to pay any existing loans you have. It will work out a lot cheaper in the long run due to the cheap interest (APR) rates. It will also take the pressure off you needing to pay it back while you study. This tip is particularly useful for mature students.
But if you’re a new student, don’t borrow from regular lenders, including your bank. First check out private student loan lenders, they may have better offers for students than your bank or credit card company does. Once you come to the end of your degree you may have racked up some other debt. Maybe you didn’t know about private student loans. But we’d recommend taking one out now, especially if this is regular debt for non-students.
By doing so you’ll make sure the debt is at the cheapest interest rate possible and has flexible repayment terms. Remember these offers won’t be open to you once you graduate, so if you have a chunk of debt, consider this option to make it easier on yourself. People who’ve graduated and get a loan dream about how good student loans were! We really miss how cheap and flexible they were and would love to trade our debt for one of those!
What if I have bad credit?
Students loans from the government can be obtained regardless of one’s credit rating. The same isn’t true of private student loans though. They lender will still perform a credit check and has the right to decline a borrower, but the good news is they are still far more lenient and willing to lend to those with bad credit than most traditional forms of borrowing.
You’ll still have a high chance of being accepted, regardless of your credit rating. But this is never guaranteed. But we imagine just having a less than stellar credit rating isn’t enough to justify a rejection. There’s likely to be extenuating circumstances such as defaults behind a rejection. Most students have low credit scores, because they haven’t had chance to build them up yet!
What counts as a student?
This isn’t as obvious as it sounds. But to be officially classed as a student you’ll need to be formally enrolled at a collage, university or other academic establishment either full time or part time. So you’ll need to study enough hours a week to not be able to work full time. Going to a few evening classes won’t count.
But what does count are all forms of degrees, including PGCEs, PHDs and other formal qualifications that require months or years of study to attain. If you are able to apply for a government student loan while studying, then you’ll probably be able to apply for a private student loan too.
The good news is you can also have a part time job too. This shouldn’t ever stop you from applying!
- Students are not nowadays limited to getting loans from the Department of Education.
- Private UK lenders can provide loan options to supplement or pay off existing loans.
- Loans can be arranged on the same day in many instances, even with bad credit scores.