Student Loans
Students and Graduates
Student loans
Student loans are amoung the cheapest around.
They are pegged to the inflation rate (about 2.5% pa currently) and are "capped" at 1% above the base rate.
If
you need a loan to help you pay for your studies, you want to check out the Student
Loans Company where you can borrow over £3,800 (£4,600 in London)
a year.
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Bank Overdrafts for Students
Be careful. Your local friendly high street banks want to lure unsuspecting students into their web by offering you interest free overdrafts.
No. They are not your mates.
Contrary to the impression they may want to give you, these are not non-profit making student loans.
Far from it. They are coldly calculated commercial loss leaders designed to hook you into staying with the bank after you've graduated.
That's when the bank will start charging you a high rate of
interest on the same overdraft.
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Graduate loans
Like student overdrafts, don't confuse these with student loans.
The banks target graduates with slick advertising.
The interest
rate for graduate loans is usually lower than normal. But the sting is in
the way they rise subtly, creeping up until you find you're paying through the
nose - if you ever even notice.
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