How does Student Finance work in this situation?

[janeeire244]

For the Oxbridge Foundation Year programmes, Oxbridge give students a one-year scholarship in which they provide funding for all tuition costs and living costs for the year. Therefore, they claim that you don’t need to take out Student Finance.

However, is it theoretically possible to still take out Student Finance just so you can get extra money? I understand that wouldn’t be particularly wise since you would accrue loans but is it possible? Is it possible to ask Student Finance to not give you loans for tuition (since that’d already be covered) but just give loans for maintenance so you can have extra money from that?

Furthermore, if Student Finance did agree, would Oxbridge find out or not?

There’s nothing wrong with trying to maximise the amount of you have so that’s why I’m asking this question.

When you apply for student finance there are a lot of questions, including whether you have any scholarships / funding or financial assistance for your chosen course. So unless you intend to lie on the form they will know from the outset and are unlikely to provide additional funding to you.

It’s unlikely as funding is already being provided.

Why does it seem like Student Loans are some sort of grant rather than just a normal bank loan? Why would they care about scholarships/additional funding when a loan is a loan and you’re going to be repaying them in the future? Couldn’t someone just get a loan from a normal bank then?

A prospective student needs to distinguish between Tuition Fees funding and Living Costs funding. They should also be clear about the difference between a loan and a grant.

Finally, there may be a restriction in the number of academic years for which a loan or a grant can be claimed. Don't use up this allowance on what is already a well funded one year Foundation programme.

Why would you need further funding? SFE covers exactly the same costs. If you are short are there any relevant bursaries or discretionary funds or you work part-time in vacations.

Why does it seem like Student Loans are some sort of grant rather than just a normal bank loan?

Because they are, in the sense that the government is expecting to provide a subsidy on them.

Why would they care about scholarships/additional funding when a loan is a loan and you’re going to be repaying them in the future?

Because you might not be repaying the loans in full in the future. The required repayments are income dependent. The less you make in a given year the less you repay, though the principal remains and interest continues to accrue. For new students, any remaining balance will be canceled after 40 years. The government expects most people to repay the loans in total, but a substantial minority will not. They currently expect to subsidise about 30% of new loans. But they've had to revise the expected subsidies upwards several times over the last couple of decades.

Couldn’t someone just get a loan from a normal bank then?

I don't think that the government's expected subsidy figures take into account that the interest rate they charge is not a commercial rate. I doubt if any bank would give you an unsecured 40 year loan at the lower of RPI or Base Rate + 1%.

My DC took part in one of these, and Course Director told them absolutely not to apply for finance. To be honest, the grant was more than sufficient.

We also subsequently had confirmation from Student Finance England that as finance had not been taken, the "full course plus gift year" was still available for future study.

And yes, they do find out - the grant system uses the student finance system so they know that you've taken the additional.

And in terms of sf vs bank loan, a bank loan is usually repayable from the moment you take it whereas sf only from when you earn above the threshold.