Financing a postgraduate degree in the UK, a land steeped in academic prestige, can feel like climbing a mountain. Tuition fees and living expenses can be overwhelming but don’t worry. Education loans are here to bridge the financial gap and turn your academic aspirations into reality.
This article delves into the two main types of education loans available for international students pursuing postgraduate degrees in the UK: Secured and Unsecured loans. We’ll explore the details of each type, including their eligibility criteria, and more.
By the end, you’ll be equipped to make an informed decision and choose the student loan for postgraduate study in UK that best suits your financial situation and academic goals. So let us get started.
Cost to Study Postgraduate Degree in the UK
Acquiring a postgraduate degree in the UK can be an enriching experience, but it’s important to consider the financial implications. Tuition fees for international students can range widely, from £9,000 to £30,000 per year. On top of that, factor in living expenses. In London, you’ll need roughly £1,300 to £1,400 monthly to cover necessities like accommodation, bills, and groceries. This cost can be slightly lower, between £900 and £1,300 per month, in other UK cities. So, careful budgeting is key to ensure a smooth and financially secure study abroad experience. Let us now move ahead and explore everything about the two major types of loans.
1. Secured Education Loans
Secured Education Loans offer a safety net for lenders. To obtain this type of laon, you or a co-signer, typically a parent or guardian with strong financial standing will need to pledge collateral – an asset of value such as property or fixed deposit. This collateral serves as guarantee for the lender. If for some reason you are unable to repay the loan, the lender can seize the pledge asset to recoup their losses.
Advantages
- Lower Interest Rates: Due to the reduced risk for the lender, secured loans come with lower intertest rates compared to unsecured loans. This helps you to significant savings over the loan repayment period.
- Higher Loan Amounts: With the security of collateral, lenders are often more comfortable offering larger loan amounts to cover your entire tuition fees and living expenses in the UK. Therefore, this allows you to focus on your studies without financial worries.
Disadvantages
- Collateral Requirement: The biggest hurdle associated with secured loans is the need for collateral. Not all students have access to an asset valuable enough to secure a significant loan.
- Risk of Asset Loss: If you default on the loan, you risk losing the pledged collateral. This can have severe financial repercussions.
Eligibility for Secured Education Loans
Eligibility criteria can vary depending on the lender, but generally include:
- Having an Indian Nationality.
- Having a confirmed offer of admission to a recognized postgraduate program in the UK.
- Possessing good academic records.
- Having a co-signer with a strong credit history.
2. Unsecured Education Loans
Unsecured education loan for students to study abroad, as the name suggests, don’t require collateral. This makes them a viable option for students who lack assets to pledge. However, the lack of security for the lender leads to higher interest rates compared to secured loans.
Advantages
- No Collateral Required: This makes unsecured loans accessible to a wider range of students, regardless of their asset holdings.
- Faster Application Process: The absence of a collateral valuation process can streamline the application process compared to secured loans.
Disadvantages
- Higher Interest Rates: Be prepared for a higher interest rate with unsecured loans. This can significantly increase the total cost of your education.
- Lower Loan Amounts: Lenders might be more cautious when offering unsecured loans, resulting in lower maximum loan amounts compared to secured loans. You may need to explore additional funding options like scholarships or part-time work to cover all your expenses.
Eligibility for Unsecured Education Loans
Eligibility criteria for unsecured loans can also vary by lender, but often include:
- Being a citizen of India
- Admission confirmation to a recognized postgraduate program in the UK.
- Possessing good academic records and a strong credit history.
Summing Up
Though both types of education loans have their own pros and cons, weighing up your financial situation and risk tolerance will help you choose the right loan to turn your academic dreams into reality. Thus, if you want detailed insights on top lenders, potential interest rates, and the process of how to get education loan for abroad studies you can search for some of the top overseas education loan advisors. Good luck!