The tertiary education in New Zealand is of excellent quality and constantly advancing; these are among the main reasons why it is becoming more expensive.
If your family or an employer cannot pay for your studies or are able to cover just a portion of the cost, you can use a student loan. Find out more about the personal loans available to you and how to obtain one.
Student Loan – Options
The government student loans are the main option for New Zealand students. They are easily accessible to everyone and affordable as well. That is why the main focus in this guide will be on them.
The only negative aspect of these loans is that they are subject to limits. If the limits make it impossible for you to cover your student expenses, you can resort to conventional loans available from banks. There are personal student loans which come at competitive rates. They are typically unsecured, but may require a co-signer with good credit history and a sufficiently high employment income.
Let's take a look at the student loans available via the government's StudyLink scheme.
Qualifying - The government student loans are available to all full-time and to part-time students. There is no requirement for placing an asset as collateral. Applicants do not have to pass a means test. You can qualify no matter what the financial situation of your family is. If you are under 18 years of age, you will need the consent of your parents in order to obtain a loan.
Loan amount - The StudyLink loan consists of three separate parts. You can choose which ones to take. The first part covers your tuition fees. The granted loan amount is paid directly by StudyLink to your school. The second part is designed to cover costs related to your studying. These include expenses for textbooks, study materials and equipment and travel. The third part is intended to cover your living expenses. If you study part-time, you may be able to qualify only for the first part.
Cost - The government student loans in New Zealand are interest free for students who study in the country. You will have to pay back only the principal amount. If you study abroad for over six months, you will most likely have to pay interest. You will have to pay an administration fee if you have a balance of over NZ$20 with Inland Revenue on an annul basis until you repay the loan.
Repayment - You will have to start paying back your StudyLink student loan only after you graduate and start earning an annual income above a certain threshold. The minimum amount which you have to pay back every month is calculated using a specific formula. Your employer will make a deduction from your salary and pay it to Inland Revenue every month.
Application - In order to apply for a StudyLink student loan, you have to visit the official website of the scheme and to fill out the application form. You will be able to follow your application online. You will receive a letter inviting you to submit any required documents. Once your application is approved, you will have to agree to a contract. After this, the loan will be available to you.
The student loans in New Zealand are easy to obtain and simple to understand. They are quite affordable as well. Still, it is important that you plan the repayment.