Student loans are a way of financing studies that are increasingly used in France and are constantly growing with the crisis – Read more
Student loans are a means of financing higher education that is increasingly used in France. According to the Observatoire de la vie étudiante, 140,000 young people used the student loan in 2013 . This figure is constantly growing with the crisis.
According to an INSEE study released in 2002, 90% of students aged between 19 and 24 who no longer live with their parents still depend on permanent or occasional help from their parents. These sources of money associated with state aid are often supplemented by student loans.
The loan gives the advantage of providing consumer credit to support the lender’s studies and related expenses. In a number of conditions, the state can provide collateral for this loan.
What is the student loan?
The student loan is a credit intended for students to finance their study project even in case of lack of resources and deposit.
Who can get a student loan?
The borrowers eligible for the student loan must be young adults according to Article 341-4 of the Monetary and Financial Code. Banks request the opening of an account and to justify student status by providing a university or high school registration card.
Some financial institutions limit the age of lenders to a maximum of 28 years. Others have no requirement, but the age of death and disability insurance coverage is limited to 36 years.
To obtain a student loan, with the state guarantee, in addition to a valid registration in a high school for the BTS or in universities and colleges, you must:
- to be under 28 at the time of subscription
- to be French or citizen from a country the European Economic Area (EEA)
What guarantees can we receive from the state?
Instead of having a parent as guarantor or guarantor, the state provides you through the public investment bank a guarantee with the financial institution lender. The Ipii France, will refund your possible failures.
For requests, you do not have to be a customer of a bank to submit an application. The bank can refuse to lend you even if you have the support of the state when it considers that you can not support the repayments.
How much can I get from a student loan?
As the lending institution is betting on the future of a potential customer that you can be, it will credit more a master’s student than a bachelor’s degree 1 or a high school student than a social science student. Moreover, according to a survey of the Observatory of Student Life (OVE), students in the trade sector are in pole position among the largest borrowers.
Loans can range from 760 to 45000 €, depending on the bank and the duration of the credit which ranges from 2 years minimum to 10 years on average . The higher a bond and high personal income, the larger the loan amount will be. Any student loan contract must mention the possibility of anticipating repayment while specifying the conditions of this reimbursement.
How is the refund?
The student loan is repaid in two-strokes . As a first step, you must make a choice for the so-called deferred phase of repayment (2 to 6 years). There is:
- Partial exemption or deductible where the lender only pays interest and insurance premiums such as disability-death insurance (not required)
- The most expensive exemption or deductible on the entire credit. You only initially pay for the insurance premiums you have taken out.
In a second time or amortization phase, at the end of studies, you repay the capital of the credit. The duration of this second stage depends on the first stage and the entire duration of the credit can reach 12 years. top