Published: July 14, 2021 | Updated: July 26, 2021 | Posted by: Venus Zoleta | Loans
About 44,000 college students were expected to have stopped schooling in 2020 amid the pandemic. Most of those who might not have enrolled last year said this was due to the economic crisis since most parents have lost their jobs. This year, there’s no reason for you to be left behind because you have alternatives to explore for funding your college education.
Now more than ever, student loans in the Philippines can help financially challenged families. Undergraduate students who may have been declined scholarships and grants can seek refuge from student loans to pay for tuition, gadgets, school equipment, and other costs of homeschooling like internet connection.
Whether you’re a student or a parent, now is the time to take advantage of an education loan in the Philippines that can help those who are eager to continue their college education despite the financial challenges of the pandemic.
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A student loan is an amount borrowed to pay for the cost of a college education. Also called an education loan, tuition loan, or tuition installment plan, this type of loan usually covers tuition and other school fees, books and supplies, allowances, student accommodations, and other school expenses.
Students who need financial assistance (or their parents and guardians) may apply for student loans in the Philippines.
Unlike scholarships and grants, student loans must be paid back in monthly installments, plus interest, over the entire loan term. Some lenders allow student-borrowers to fully repay their loans after they graduate or find a job.
All these terms refer to financial aid for students to pay off higher education expenses. Although scholarships, grants, and student loans may sound the same, these three are entirely different from each other.
For a clearer view, below is an explanation for each type of financial assistance for students in the Philippines.
Scholarships are usually given to students who have passed the academic requirements for eligibility. More often than not, scholarship programs in the Philippines consider the previous grades of the applicant and the current scores incurred after taking an examination to become a scholar.
In essence, scholarships are based on either the student’s academic performance or skills. For instance, Jennifer is a scholar because she was a member of the university’s volleyball team, while Gerald is a scholar because he consistently maintains high grades in his subjects.
You may have a scholarship during your first year in college, but you might lose this once your grades fall below the required rating. Scholarships can also be given full or per semester, depending on the terms of the aid. Government agencies, LGUs, and higher education institutions usually sponsor scholarship programs.
A grant refers to the amount provided to a student in the form of cash. This is unlike scholarships that may cover a full semester for free without the need to receive an exact amount of financial assistance.
Grants may or may not be based on academic performance. Some sponsors consider the applicant’s economic status. For instance, you can have a grant of PHP 50,000 worth of college funds. This may or may not cover the costs for the entire school year but may be used to pay for tuition and other school expenses.
Student loans are entirely different from grants and scholarships because the amount borrowed needs to be paid back. Whether it’s a government student loan in the Philippines or a loan from the bank, students should return the money according to the terms and conditions indicated in the loan agreement.
So how are such loans considered a form of financial aid? Although you need to pay off the money in the future, the loan eases the financial burden of going to school. Use the loan amount to study and graduate, then start repaying after a specified loan term, or if you’ve earned your degree and landed your first job.
Applying for a tuition fee loan is one of the most practical options students and parents can consider. Here are a few reasons why.
Student loan interest rates start as low as 0.50% each month, which is way lower compared to personal loan interest rates from 0.69% and above. Some government student loans also don’t charge application fees, which can be a huge relief for those who are trying to cut education costs.
Contrary to credit card and personal loan applications, most student loans don’t check on your or your parent’s credit scores. This means you’ll have a higher chance of approval once you have submitted the correct documents and complied with the requirements.
Although a few student loans should be paid by the end of the current semester, most tuition loans in the Philippines allow borrowers to pay off the amount after graduation and when they have already found their first job.
Instead of you and your parents worrying about payment before examinations, student loans give you peace of mind, allowing you to focus on your studies and plan your career.
Once you’ve taken out a student loan, you’ll be trained to manage your personal finance properly. You’ll learn the importance of repaying your debt on time and fulfilling your monthly obligations. It can also be a good start to build your credit history, so you can apply for much bigger loan amounts for business and other investments in the future.
Related article: What Student Discounts are Available in the Philippines?
Government agencies, banks, and private lenders in the Philippines provide student loans. For this list, we’ve narrowed down your options to 10 education loans with the best features. Some of them charge low interest, reducing the cost of borrowing. Others have an easy and quick online application for students who need to pay for their tuition urgently.
Here are the best student loans in the Philippines for students who need financial aid.
The student loan program of the Commission for Higher Education (CHED) is known as the Tertiary Education Subsidy under the Unified Financial Assistance System for Tertiary Education Act or UniFAST. This program is also known as the Republic Act 10687, which grants financial assistance programs for tertiary education.
The UniFAST law covers two categories: Tertiary Education and Special Purpose Education Assistance.
Tertiary education refers to the higher education that comes after secondary or high school. It also includes non-degree diplomas, post-secondary and Technical-Vocational Education and Training (TVET), and higher education programs like baccalaureate degrees and graduate education.
Special Purpose Education Assistance
“Special Purpose Education Assistance” refers to activities related to the continuity of an educational program, which includes research and scientific studies in the college and masters/doctoral level funded by Student Financial Assistance Programs (StuFAPs).
The funding covers the writing of manuscripts, publication of books and other academic materials, and production of files or other forms of documentation.
One can apply for scholarships and grants at CHED, TESDA, any of the departments, and other government instrumentalities such as the DOST, DOLE, DSWD, DND, DA, DILG, DENR, OPAPP, NCIP, among other StuFAP-granting institutions. Loans are provided only by CHED and government financial institutions like LANDBANK, BDP, SSS, and GSIS.
The Educational Assistance Loan Program (EALP) enables SSS members to borrow money to pay for their beneficiary’s college education.
Only one EALP beneficiary is allowed per member-borrower. Beneficiaries can be the member-borrowers themselves, their child, their legal spouse, or their sibling (for unmarried members only)—as long as they’re not full scholars enjoying free tuition and other school fees. They should be enrolled in any undergraduate course offered by schools accredited by CHED, TESDA, Civil Aviation Authority of the Philippines, and other government agencies.
Present the original copy and submit the photocopy of the requirements to the nearest SSS branch. Once the loan is approved, you may claim your check at the Administrative Section of the branch where you applied for EALP.
Currently, there’s no online application for SSS EALP—it’s not included in the E-Services of My.SSS portal. Thus, you need to personally file your EALP application at an SSS office.
GSIS offers two student loan programs for its members who need to borrow for the school expenses of their children, nieces, or nephews.
One is an education loan for the tuition and other school expenses of GSIS member-borrowers’ beneficiaries enrolled in an undergraduate course of a private or public university. Repayments begin only in the sixth year after the loan approval, when the student-beneficiaries have finished their studies and started working.
The GSIS computer loan is for members who need to buy a laptop and other equipment for their beneficiaries’ online classes.
Contact GSIS through its call center hotline or official Facebook page to inquire about its education loan and computer loan programs.
The Pag-IBIG Multipurpose Loan or Pag-IBIG Salary Loan helps members cover a wide range of financial needs, including their beneficiary’s tuition and other school fees. The loan amount is released through a check or the borrower’s disbursement card.
I-STUDY is a student loan program from LANDBANK that was recently launched to help parents who are struggling to finance their children’s education due to unemployment and other effects of the pandemic.
LANDBANK offers two types of student loans under the I-STUDY program. The first I-STUDY loan is for tuition or enrollment-related fees while the second one is a loan for purchasing electronic gadgets that can be used in online distance learning.
LANDBANK has recently offered the gadget loan with a maximum loanable amount of PHP 50,000. This can be included in the PHP150,000 maximum loan amount applicable to student borrowers and PHP 300,000 maximum loan amount for every parent-borrower.
Qualified students for the program are Filipinos aged 30 and below, of good moral character (as certified by the school), and who are not a current beneficiary of free tuition and other school fees under RA 10931 or any scholarship program.
The I-STUDY program is available only for School Years 2021 to 2022.
Submit the student loan requirements to the nearest LANDBANK lending center. Once your loan is approved, you’ll be required to open a LANDBANK deposit account where the funds will be credited. Additional documents should also be submitted to the bank before the loan amount is released and after enrollment.
Citibank offers a low-interest personal loan with flexible payment terms and a high loan amount limit. Applicants can also get approved in as fast as 24 hours. Such features make the Citi personal loan ideal for borrowing money for college tuition payments.
BPI credit cardholders may avail of a tuition installment plan using their card. No need to submit any document to the bank or go through a tiring loan application process. The loan can be used to pay not just for tuition but also for other school expenses.
Simply use your BPI credit card when paying for tuition at a BPI-accredited school. You’ll be billed your monthly amortization over a period of up to 12 months based on your chosen loan term.
Bukas is an education financing company licensed by the Securities and Exchange Commission (SEC) that provides student loans for college students in the Philippines. Students of Bukas’ partner schools such as FEU, CEU, Mapua University, and Lyceum of the Philippines may avail of a Bukas student loan.
This tuition loan is easy to obtain through an online application with a one to three-day processing time. It’s also flexible when it comes to repayments, as borrowers can start repaying their loan 30 days after application.
Register for an account on the Bukas.ph website (app.bukas.ph/register), complete your profile, and fill out an online application form. You’ll also need to upload an image of each requirement. Wait for a text message from Bukas about your loan approval.
InvestEd is a social enterprise licensed as a lender by the SEC. It provides four types of student loans for different purposes: tuition payments, gadget purchases (e.g., laptops, tablets, and smartphones for online classes), allowance, and payments for thesis-related expenses.
InvestEd makes education loans more accessible through an easy online application process and customizable payment plans. Student-borrowers may choose to repay immediately or after graduation.
Students approved for the InvestEd education loan also receive digital one-on-one coaching to guide them through repayment and provide them with tips and tools for graduating from college and starting a career. It’s the only student loan in the Philippines that offers a coaching program to borrowers.
Create an account on the InvestEd website and fill out an online application form. Within two to five days, you’ll receive the results of your student loan application.
If you qualify, you’ll undergo a 20-minute phone interview with a loan officer. An InvestED representative will ask you to submit documents such as a valid government-issued ID, proof of address, and proof of academic status.
Once approved, your loan amount will be released via your mobile wallet or bank account. For tuition and gadget loans, the funds are paid directly to the school or equipment supplier/merchant.
Here are the steps to get an education loan to cover the cost of your tuition and other school expenses.
Unlike personal loans and payday loans, student loans are not popular among Filipinos, so it helps do your research on the different Study Now, Pay Later programs available for college students like you.
Private lenders and government institutions offer different interest rates. Student loans from the government are inexpensive in terms of fees but may require you to undergo a tedious application process. Sometimes, the struggle is worth the money you can save.
However, there are times when your access to resources limits you to student loans from banks and other private lenders. You should always take time to weigh all your options because practicality cannot be measured by savings alone.
To ensure you won’t be burdened with loan repayments you can’t afford, study each of your options carefully and then compare its features with other student loans.
Particularly, look for these features:
Whether you love or hate math, you have to compute the monthly installment to know if you (or your parent) can afford it. Check the lender’s website for a sample computation of monthly amortization. If it’s not available online, inquire through the lender’s customer service hotline or social media account.
Compute the cost of the full loan against the loan term, interest rates, and fees. Make sure there are no hidden charges. Applications for most student loans in the Philippines are free. Some fixers may offer to facilitate easy loan applications and may ask for money in return. Beware of individuals who pose as staff of any government agency or private institutions offering the student loan. These may ask for a commission or may even be a total scam.
Most college students are considered of legal age, but some lenders require the guidance of a parent of an older relative to serve as the guarantor for the loan. Parents may not apply as the primary borrower, but they can be responsible for their children’s unpaid college loans, especially if they consented as a guarantor.
Some documents you should initially prepare:
Once you have all the requirements ready, submit your application to the student loan provider. Depending on the lender, you can apply for a tuition loan either online or in-person at the provider’s office.
Here are some quick tips to help you pick the right student loan plus tips for a faster student loan approval.
Students are easy prey for illegal lenders because of their lack of knowledge and experience. Never transact with lenders that charge a very high interest rate. Research the company’s background and check if they have a lending license from the SEC.
You might think that student loans need to be paid and should not require good grades. Remember that some lenders check borrower’s grades in the previous year to see if they’re capable of focusing on their studies and using the loan for educational purposes only. Your academic performance can also be used to evaluate your sense of responsibility as a borrower.
Almost all transactions can be done online. To protect your privacy and personal information, make sure you’re transacting through a legitimate website. Some fraudsters may not benefit from your loan but may use your identity to make fraudulent transactions.
Involve your parents or guardians in your decision-making. If you’re still living with your parents or relatives, discuss your plans of applying for an educational loan in the Philippines with them. Their wisdom and experience can help you make a good decision when it comes to selecting the right school, choosing the appropriate course, and applying for the best student loan with the lowest interest rates.
Even better, consult someone who’s knowledgeable about student loans, such as a lawyer, accountant, or finance professional. Their opinions can guide you through choosing the best loan for you.
Student loans are financial aid that can ease the burden of paying for your education. These are a privilege you can grab to secure your future. Don’t let your financial situation stop you from achieving your dreams. Legitimate student loans in the Philippines help students continue their college education and focus on their studies instead of worrying about how to fund their education.
Below is a list of other best personal loan companies and their loan features. Compare your options and apply through Moneymax!
|Personal Loan Provider||Features|
|Citibank Personal Loan|
|EasyRFC Multi-Purpose Loan|
|SB Finance Personal Loan|
|TALA Personal Loan|
Venus is the Head of Content at Moneymax, with 15+ years of experience in digital marketing, corporate communications, PR, and journalism. She invests in stocks, mutual funds, VUL, and Pag-IBIG MP2. Outside of work, she’s crazy about cats and Korean dramas. Follow Venus on LinkedIn.