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Advanced Learner Loans – the facts

Employees interested in training? Did you know there’s a new loan that makes studying work qualifications more affordable? Advanced Learner Loans help support students aged 19 or above with the cost of course fees for full Level 3 to 6 courses.

Who qualifies for the loan?

The Advanced Learner Loan is not means-tested and does not require a credit check, but to be eligible for the loan students must be:

  • Aged 19 or over on the first day of their course
  • Starting their course on or after 1 August 2016
  • A UK National or have 'Settled Status' - which means no restrictions on how long they can stay
  • A resident in the UK, the Channel Islands or the Isle of Man for three years immediately before starting their course
  • Enrolling on a full Level 3 to Level 6 course (details below).

Who applies for the loan – the student or the employer?

The student applies for an Advanced Learner Loan, which is then paid directly to the college or training organisation.

What can the loan be used for?

The loan is designed to pay for part of, or the full cost of, the tuition fee for a full Level 3 to 6 course – the loan cannot be used to pay for individual units or awards. Qualifications that learners can use the loan for include:

  • A-Levels (up to four)
  • Access to Higher Education Diplomas
  • BTEC and other Diplomas and Certificates
  • National Vocational Qualifications (NVQs)

What about apprenticeships?

Unfortunately Apprenticeships are no longer supported.

How much can be borrowed?

There is a minimum loan amount of £300, and the amount learners can get depends on the cost of the course they are taking. Students can choose a loan that pays for the full cost or part of the cost of the course. If a student is paying part or all of the course fee themselves, Bedford College offers an affordable instalment option to help spread the cost – see details below.

How does the loan work?

The Advanced Learner Loan is similar to existing loans for higher education – and is administered by the Student Loans Company (SLC). Once the loan is approved, they will pay the agreed amount to Bedford College when the student starts their course. Students only need to apply once per course, so if, for example, a course is longer than one year the learner does not need to apply separately for each year.

Can my employees take out more than one loan?

Students can apply for up to four loans in total, simultaneously or one after the other, and would need to apply for a loan for each course. Visit www.bedford.ac.uk/loans and use the eligibility tool to find out more. 

What happens about repayments?

Paying back the loan is simple – repayments begin in the April after the student completes their course and only when they are earning over £21,000 per year. Payments are automatically taken from an employee’s earnings through HMRC.

Can I repay the loan on behalf of my employee?

Yes, employers can make voluntary payments for part of or the whole of the loan amount on behalf of employees – please consult independent advice on whether there may be any tax consequences for your business.

How much are the repayments?

Repayments will be 9% of any income above £21,000 per year, £1,750 per month or £404 per week. So if for example an employee is earning a salary of £25,000 per year, repayments would be calculated as 9% of £4,000, which equals a £30 repayment per month.

If an employee’s salary falls below the earning threshold, repayments will stop. If an employee’s salary never increases over £21,000, no repayments will have to be made – any outstanding debt will be written off if a learner has not repaid their loan after 30 years.

If the student doesn't complete the course they will be required to repay the loan amount relative to their attendance as well as any outstanding course fees, which will be payable to the College. Take a look at the repayment calculator at www.bedford.ac.uk/loans 

What about interest charges?

Interest on the loan is linked to inflation and is set at the rate of the Retail Price Index (RPI) plus 3% during the course. 

Now, the interest rate charges after completing the course will be based on the learner's income, charged at RPI for incomes of £21,000 or less, RPI plus an increasing percentage up to 3% for incomes of £21,001 to £41,000, and RPI plus 3% for incomes of £41,001 and above.

How do my employees apply for a loan?

Students will need their learning and funding letter provided by Bedford College. Students can apply for a loan online through Student Finance England at www.gov.uk/advanced-learning-loans. Application forms can also be requested by calling the helpline on 0300 100 0619. In the meantime, you can keep up to date right here.

Other ways to pay…

Taking out a loan isn’t the only way employees can pay for their course at Bedford College – for courses over £100 we also offer an affordable Direct Debit instalments option to help spread the cost of tuition fees. Students will pay an initial non-refundable deposit when they enrol on their course, followed by:

  • A maximum of four further payments for courses lasting under six months OR
  • A maximum of six further payments for courses lasting over six months.

Please note: an extra £20 charge applies if paying by instalments.