CHE Student Loan Test 2011: Easy transition to Master’s funding not always guaranteed
Students who fund part or all of their Bachelor’s programme with a student loan should insist, at the start, on a clear option to continue the loan over a possible, subsequent Master’s programme.
Student loan contracts cannot always be extended over the duration of a Master’s programme on the basis of the same conditions. This is a result of the sixth CHE Student Loan Test that presents 33 student loans and assesses them from the student’s point of view. “Regional offers from the Sparkasse and Raiffeisenbank usually offer easy extension options,” said Ulrich Müller, CHE project manager. “For national offers, prolongation of the contract often depends on a case-by-case assessment, e.g. based on the study performance so far.” It is easy to extend an existing contract to cover a Master’s programme at the Deutsche Bildung Studienförderung or at KfW-Studienkredit.
There is one clear difference in the conditions of the loan offer at the point of transition from Bachelor’s to Master’s programme: if a student loan is used only until completion of the Bachelor’s degree and the subsequent Master’s is funded from other sources (e.g. via a scholarship) then in some cases repayment of the loan will start already during the Master’s programme following a short grace period. “Student loan providers should make sure that repayments don’t start until students start working”, said Müller.
It is the sixth time the CHE Student Loan Test has been carried out and published together with the Financial Times Deutschland, this year in an updated version. Using 20 criteria, the test involves a detailed analysis of the advantages and disadvantages of the existing student loan offer for different target groups. “When selecting an offer, it is not enough merely to consider the interest rate”, said Müller. “Intended use, target groups and conditions differ considerably.” The CHE Student Loan Test mainly aims at interested and potential students to help them make a decision. A thorough assessment of the market situation, at the same time taking the students’ personal requirements into account, has been made possible in this version of the test thanks to refined methodology and the presentation of detailed information.
Further Information can be found in the publication stated below.