Student loans are a saving grace for many brilliant but needy students. The government sponsors some student loans in South Africa while some private institutions grant student loans at very low interest.
How do student loans work in South Africa?
The first requirement for a student loan is a stable income. Here, the parent of the student applying needs to have a monthly stable income. The parent will pay the interest on the loan monthly while the student is in school. After graduating, the student will have to repay the loan in instalments.
If your student loan comes from a bank, they may give you a grace period of 3-t months after graduation before they ask for repayment of your loan. Understandably so because you just graduated and you need time to find a job to pay the loan. If you cannot make the payments during the stipulated time, the burden falls on your guarantor to settle the debt.
Are student loans a good idea?
As we mentioned earlier, student loans will help you finance your education if you are experiencing financial constraints. However, there are some circumstances where student loans can be more trouble than they are worth.
If the student is a lifeline to achieving your career goals, then take the loan. But student loans are still debts on top of many things you may have going on. And few people want to be saddled with that burden.
Here is what to consider before going for a loan
Student loans have huge interests in them, contrary to popular belief that student loans bear little to no interest.
Always consider your future job prospects before going for a loan. If you may not get a high-paying job right after graduating to repay the loan, we say stay away.
They directly deposited the money from the student loans into your bank account with no restrictions. Unfortunately, many students pay their fees and misuse the rest of the funds. It is important to know that student loans are serious business and they will expect you to pay your loan amount and interest.
Student loan options
Several platforms provide student loans. The most popular ones are government student loans from the National Student Financial Aid Scheme (NSFAS). You can also get a student loan from banks and other financial institutions.
