Key Considerations for School Fees Loans
At What Level of Education?
When you are to borrow for school fees payment, you may need to consider the level where the child is in the education cycle. Yes you may need the money but if you start borrowing for school at nursery level, it may not be sustainable as it may wear you out on this long journey of education. Why say borrow to sustain a child in a private primary school when it could be manageable in a government added school at that level?
“Some parents have taken these 'school fees' loans and they have led them into financial troubles than what would have benefitted"
Amount needed.
Some lenders are willing to give you amounts far above the school fees requirement. If you fall for their trap, you will be in debt far above your need. This will entice you to consider spending the money on other consumption needs yet the time for repayment will come.
Repayment period
School fees is paid termly. Some lender ignore this and offer loans of years all dubbed school fees
loans! Why would some one borrow school to be repaid monthly over 5 years? The realistic repayment period for a school fees loan for one term should be about 6months to 1 year, to even allowing borrowing again for other terms. Stick to short term.
Security requirement and other extra commitment?
The loan being for fees, and for a short term, it should enlist the minimum or no security requirement. A school fees loan where you have to pledge a land title of a value far above the borrowed amount, may be a recipe for loss. Beware of lenders who may want to take advantage of the season to rip the unsuspecting borrower of their property. Ideally school fees loans should be tied to income sources than heavy security requirements.
Any easier alternatives to consider?
Some times we go for school fees loans having not considered the easier or cheaper options. Have you considered options like savings for the school fees?, There is also a possibility of prior negotiated partial payments with the school administrators. There has also been cases where parents/guardians have been allowed to pay in kind payments or even offer labour or needed other services at school. Explore any available alternatives before you take out that interest bearing loan.
An Era of Government loans
For higher institutions of learning, the government graciously introduced a more favorable loan option where the student will pay after getting into employment or productivity. So before you take out that “low hanging” school loan ask your self twice.
I look forward to seeing how these developments will improve service levels and customer satisfaction in the freight industry!