Government-backed postgraduate loans worth up to £10,280 are now available, to help Masters students cover their tuition fees and living expenses
These non-means-tested, repayable postgraduate student loans are similar to those that are offered to undergraduate students, and are a major new development for higher education in England.
How much can I borrow?
From the 2017/18 academic year, you will be able to borrow any amount up to a maximum of £10,280 - slightly more than the £10,000 currently available. Regardless, the Masters loan can completely cover the cost of tuition fees for most Masters courses, given that the average programme is priced at around £8,000. The notable exception to this is the Master of Business Administration (MBA), which is often more expensive.
What's more, you're under no obligation to spend the postgraduate loan on tuition fees; it can also be used for living expenses or other study-related costs.
Is my programme eligible for a postgraduate loan?
Programmes must have started after 1 August 2016, and be delivered by a university or college in the UK. International placements cannot account for more than 50% of the programme.
Almost all full-time Masters degrees are eligible, providing that they last no longer than two years. Part-time and distance learning courses are also covered, but mustn't be more than twice the length of any full-time equivalent. In other words, the maximum course length covered by postgraduate loans is four years.
Eligible Masters qualifications include:
- LLM (Master of Laws);
- MA (Master of Arts);
- MEd (Master of Education);
- MFA (Master of Fine Art);
- MLitt (Master of Letters);
- MMus (Master of Music);
- MPhil (Master of Philosophy), unless it leads directly to a PhD;
- MRes (Master of Research), unless it leads directly to a PhD;
- MSc (Master of Science);
- MSt (Master of Studies).
The only ineligible Masters degrees are the full-time MArch (Master of Architecture) and MEng (Master of Engineering), as these are covered by undergraduate student loans and finance rather than Masters funding. Masters degrees that follow on from a postgraduate certificate or diploma are also ineligible.
Other ineligible qualifications include:
- Legal Practice Course (LPC) and Bar Professional Training Course (BPTC) - The former of these is eligible only if it's studied as part of an LLM.
- PhDs - Separate PhD loans worth up to £25,000 will be available from 2018/19.
- Postgraduate certificates and diplomas - This includes the Graduate Diploma in Law (GDL) and the Postgraduate Certificate in Education (PGCE), the latter of which is covered by teacher training funding.
Am I eligible?
- be aged under 60 when you start the course;
- not be eligible for any other government funding, such as an NHS bursary or Social Work Bursary;
- not have previously studied a Masters degree or PhD.
Residential eligibility criteria is fairly complicated. If you're a UK national who has lived in England for the last three years for a reason other than study, you're eligible. If you're an English resident who has studied in a different country for the last three years, you're also eligible.
Students from the European Union (EU) must have been resident in the EU, European Economic Area (EEA) or Switzerland for the last three years for a reason other than study. Students from the EEA or Switzerland are also eligible to study in England, providing that they've been resident in England, Scotland, Wales or Northern Ireland for the last three years for a reason other than study.
Students from outside of the EU, EEA or Switzerland aren't eligible, unless they have the right to reside permanently in the UK - due to having refugee status, for example.
Students who receive other forms of postgraduate funding that are not financed by the government are still eligible for the Masters loan. However, students who receive the Masters loan may be ineligible for other forms of postgraduate funding - though entitlement to Disabled Students' Allowances (DSAs) will remain unaffected.
How will I receive my Masters loan?
The postgraduate student loan will be paid directly into your bank account by the Student Loans Company (SLC), in three instalments per year of 33%, 33% and 34%. This means that students on:
- one-year, full-time programmes may receive up to £10,280 in three instalments;
- two-year programmes may receive up to £5,140 each year, in three instalments per year.
You only get payments in the first two years of a course. Therefore, even if you study on a part-time course over three or four academic years, you'll have received your entire postgraduate loan by the end of your second year.
Payments begin once your attendance is confirmed by your university. Be aware that loan instalments will cease if you leave your course early or change to a programme that isn't eligible for the Masters loan. In such cases, any money that you've borrowed must be repaid.
When will I repay my postgraduate loan?
Postgraduate loans will be repaid concurrently with the undergraduate student loan, on an income-contingent basis at a rate of 6% on your earnings over £21,000. Interest rates, meanwhile, are set at retail price index (RPI) + 3%. This means that the interest charged will be the annually-reviewed RPI percentage, plus an additional 3%. Interest will begin accruing once you receive your first payment, and all of the above terms are frozen until at least 2021.
No repayments will be enforced until April 2019, but can be made voluntarily. From April 2019, full-time students will begin repayments from the April after they graduate, while part-time students will begin repayments from this point or the April two years after their course begins - whichever comes first. Debt will be cancelled after 30 years, but most graduates will have already fully repaid by this point.
Your employer will take the repayments directly from your wage; if you're self-employed, HM Revenue and Customs (HMRC) will calculate how much you must repay on completion of your annual self-assessment tax return.
How do I apply for a Masters loan?
Applications are made via the SLC. You must apply within nine months of the start date of your Masters degree if your course lasts for one year, or within nine months of the start date of the second year of your Masters degree if it lasts longer.
While you don't need an unconditionally-confirmed place on your course before applying for the Masters loan, you'll need to disclose your chosen programme, the amount that you'd like to borrow, and your:
- bank account details;
- National Insurance (NI) number;
- passport details.
Upon application, you must print, sign and return to the SLC a 'Student declaration form'. You'll then receive a letter approving or rejecting your application or, in some cases, requesting further details or evidence.
Once your application is approved, the SLC will send you an entitlement letter. This confirms how much money you'll receive and when you'll receive each instalment.
You can change your personal details by signing into your online SLC account, but changes to your university or course must be requested using a paper 'Change of circumstances form'. You can also change the amount that you wish to borrow at any point up to one month before the end of the postgraduate loan's payment period, using a paper 'Loan request form'.
Are postgraduate loans available in Wales, Scotland and Northern Ireland?
In 2017/18, the Welsh government will offer postgraduate loans of up to £10,280 under almost exactly the same terms as the English Masters loan discussed above. However, this is simply an interim measure. A brand-new scheme of postgraduate funding in Wales is currently under consultation and likely to be introduced from 2018/19.
The Independent Review of Higher Education Funding and Student Finance Arrangements in Wales - otherwise known as 'The Diamond Review' - has proposed that all postgraduate Masters students who are ordinarily resident in Wales, studying anywhere in the UK or EU, should be entitled to finance of up to £17,000 to help fund tuition fees and living costs. This comprises of:
- a non-means-tested grant of £1,000, plus a means-tested grant of up to £6,885
- a loan that 'tops up' this grant to a maximum of £17,000.
The Diamond Review also suggests the introduction of up to 150 scholarships for PhD students, covering fees and maintenance for at least three years - plus a loans system for those who miss out.
More information on postgraduate funding in Wales will be released in due course.
The essential guide to funding, choosing and applying for your ideal postgraduate programme.