What Is A Tuition Fee Loan And How Does It Work In Singapore?

 

Many students find themselves in need of financial assistance when it comes to paying for college or their university.

A tuition fee loan can be a great way to help bridge the gap and cover essential educational costs. If you are looking to finance your education but don’t have the funds upfront, you may be wondering what is tuition fee loan and how it works.

But before you rush into taking out a loan, it’s important to understand how these loans work. In this article, we discuss what is tuition fee loan and how it works.

This will help you make an informed decision on the right tuition fee loan for your studies. Keep reading to learn everything you need to know about tuition fee loans.

What Is A Tuition Fee Loan?

A tuition fee loan is a type of financial aid that helps students pay for their education. The loan is typically issued by the government and other organizations to full-time and part-time students and repaid with interest. Here’s what you need to know about tuition loans.

  • They are available to students who are enrolled in an accredited public college or university.
  • These loans can be used to cover the cost of tuition, books, and other educational expenses.
  • The tuition fee loan interest rate is typically lower than the interest rate on a personal loan, and the repayment terms are more flexible.
  • Tuition fee loan repayment can be deferred until after graduation, or while you are still in school.
  • You have the option of having your tuition loan automatically deducted from your paycheck or making manual payments. In addition, you can extend the repayment period.
  • You can get a loan for up to 90% of the subsidised tuition fee for university students or 75% of the loan for those in polytechnic programmes.

Tuition Fee Vs Study Loan

A tuition fee loan covers 90% of a student’s college or university-subsidised fees, while a study loan covers the remaining portion of the fees. Students who have taken up the maximum tuition fee and have a gross income of $2700 or less can apply for a study loan.

How Does It Work?

Tuition fee loan is a facility set up to help students finance their education at local polytechnics, institutes of technical education, or universities. The amount you can access is determined by whether you are enrolled in a polytechnic or a university.

Students in polytechnics can get a loan of up to 75% of the subsidized costs, while those in universities can access up to 90% of the subsidised tuition fees. The loan you receive is valid and interest-free during the study period.

The tuition loan starts to bear interest once you graduate. Students who take a loan to study in polytechnics have 10 years after graduation to pay the loan. University students have a loan tenure of 20 years.

Tuition Fee Loans In Singapore

If you would like to advance your studies, here are some of the tuition fees and study loan schemes to help you advance your career in Singapore.

Ministry Of Education Tuition Loan (MOE)

This tuition loan is a government program designed to assist students in financing their education. You can only use the tuition loan at local universities, polytechnics, and institutes of technical education.

The MOE tuition fee loan has a tenure of up to 10 years and covers 75% of subsidized fees at a polytechnic and 90% at a university.

You can get the MOE tuition loan by approaching the Singapore Management University. Students at Nanyang Technological University or the National University of Singapore can visit DBS or OCBC Bank for the loan.

Students in other institutions can approach DBS for the MOE tuition loan. To qualify for these loans, you must

  • Be a full-time student in a polytechnic
  • You must be a student enrolled in full-time undergraduate or postgraduate programs in approved institutions.
  • Must be a student enrolled in part-time undergraduate programs in approved institutions.

Singapore Management University (SMU) Tuition Fees Loan

SMU offers tuition fees loan to undergraduate students enrolled full-time. You can get a loan to cover 90% of the subsidized fees from SMU. The fees do not cover annual or miscellaneous fees.

You will need to start paying the SMU tuition loan due two years after graduation or when you secure employment. The maximum loan tenure of the SMU tuition fee is 20 years, and you will be expected to pay at least $100 per month.

Here is what you need to know about the SMU tuition loan.

  • The loan is interest-free while you are studying. If the student drops out of school, they must repay the entire loan.
  • To get an SMU tuition fee loan, you will need the following: a guarantor. The guarantor must
  1. A guarantor who is 21 years and older
  2. The guarantor should not be bankrupt or a fellow student studying full-time.
  3. Your guarantor should not guarantee more than two student loans.
  4. Must be a Singapore citizen if the applicant is a Singapore citizen. If the applicant is a permanent resident, the guarantor can either be a Singapore citizen or a permanent resident. Applicants who are not Singaporeans can have any nationality as their guarantor.

DBS Tuition Fee Loan

DBS Bank provides tuition loans to Singaporeans, permanent residents, and non-Singaporeans enrolled in local institutions. The main features of the tuition fee loan from DBS are:

  • Cover up to 90% of the subsidized fees at universities and 75% at polytechnics.
  • The loan is interest-free during the study period. You must make a minimum repayment of $100 when you start paying.
  • Loan tenure of 20 years for university students and 10 years for those in polytechnics. The loan tenure starts when you complete the course
  • The tuition fee loan repayment starts two years after graduation.
  • You have the option of repaying the loan in equal monthly installments or one lump sum.

To be eligible for this loan, you must have a guarantor who is at least 21 years old and is not bankrupt. Students receiving school scholarships, or the MENDAKI tuition fee subsidy don’t qualify for this loan. Additionally, if you are using your CPF savings to pay 100% of the subsidized fees, you will not qualify for this loan.

NTU Study Loan

The NTU study loan is available to both full-time and part-time students. Students can use the loan to cover their fees and living costs.

The NTU tuition fee loan is designed to help both full-time and part-time students. The following are the main terms of the loan.

  • Covers students studying biomedical sciences and Chinese medicine programs for the first 3 years.
  • You can have other tuition fees schemes, such as the MENDAKI tuition subsidy and the CPF education loan scheme.
  • To be eligible, the family of the Singaporean or Singapore permanent resident must have a combined income of $2,700. International students should have a monthly household income of $1200.
  • Part-time students who are pursuing their first degree may be eligible.
  • Part-time students can qualify for the NTU study if they have applied for the maximum tuition fee of 90%.

How To Apply for Tuition Fees Loan

Here are the steps you should follow when applying for a tuition fee loan:

  1. Research the kind of loan that covers the course you are studying.
  2. Get your letter of offer from your university of choice.
  3. Download and complete the tuition application fees. You can drop it off in person or mail it to the respective lender.

Eligibility And Requirements

The eligibility criteria and requirements depend on the lender. However, there are some basic eligibility criteria and requirements that apply to all.

Eligibility For A Tuition Loan

To be eligible for a tuition loan, you must

  • You must have a guarantor who is not bankrupt.
  • Be a student at a polytechnic or university in Singapore.
  • There is no income requirement or age restriction.

Requirements For A Tuition Fees Loan

Depending on the lender, you will require the following documents:

  • Student card or a letter of acceptance
  • Passport or NRIC
  • Proof of residence
  • Bank statements

In summary, tuition fee loans can be a great way for students in Singapore to cover the costs of their education.

Though it’s not free money and must be repaid after graduation, the repayment terms are generally lenient and manageable. The application process is also relatively straightforward and doesn’t require you to provide too much documentation or paperwork.

If you have been considering taking out a tuition fee loan, we hope this article has helped clarify what is a tuition fee loan and how it works.

Are you ready to progress your career to the next level but don’t have the finances? Visit Katong Credit and apply for a loan. Katong Credit will provide you with the funds you require quickly and at an affordable rate.

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