What is a student loan?
The word says it all: a student loan is a student loan. In short, this form of borrowing helps students get money. In many cases it is parents or the BI Groups (DUO) who provide money. Students who need money during their studies can use this so-called student credit. Because the loan is really only intended for students, it is sometimes agreed that this loan will be converted into a revolving credit one year after completion of the study.
The BI Groups is for students. For this reason, the BI Groups often uses a low interest rate. Ordinary banks cannot cope with this low percentage: if you are eligible for a student loan, this may be the cheapest form of borrowing. Moreover, taking out a student loan is particularly easy. It can often be done in a few clicks on the BI Groups website.
Because of the flexibility, a student loan is most similar to a revolving credit. For example, it is possible to borrow money for a few months, then to reset the loan if it is no longer needed.
When a student loan?
First of all, a student loan is of course only intended for students. In particular, there is often the requirement that at least an HBO or university education must be followed. Furthermore, the options depend on the study being followed, the income and the home situation. More information can be found on the website of the BI Groups (DUO).
Other student loans
Although a bank is often unable to cope with the low interest rate that the BI Groups charges when a student borrows money, it can always be cheaper. If a student’s parents grant this to a loan, this is often done interest-free. It also happens that parents donate an amount to their children, but this is of course not the same as a student loan.
Pros and cons
A student loan is quickly taken out via the website of the BI Groups, and the interest rate is very low. Moreover, the loan is very flexible. In some cases, the loan may even be canceled. The main disadvantage is that this form of borrowing is for students only, and that it sometimes happens that the loan must be repaid immediately after completing the study.
The loan system in 2015
The government has agreed to abolish the basic grant for study financing. The study will have to be borrowed from the state for this and of course also paid back. At present, it is not yet known at what interest and conditions this loan will be, but it is known that it can be paid off in 30 years.