Loans for Students on Centrelink

Education can be quite costly, and with no time for side jobs, full-time students often find themselves with financial issues. However, Centrelink provides loans for students to help them finish their education and get jobs. But how can you apply for such a loan? And what are the eligibility criteria? Read on as we discuss loans for students on Centrelink in detail.

What this article covers:

loans for students on centrelink

Centrelink offers aid for students in financial hardship in the shape of three programs, Youth Allowance, Austudy, and Abstudy. If you get funds from any of these programs, that makes you eligible for a Centrelink student start-up loan.

Getting a start-up loan on Centrelink is an ideal solution for university fees, accommodation fees, and any emergency fees you’re faced with. You can apply for it two times per year, with the maximum of each time stopping at $1,132. 

You can get the first loan from the 1st of January to the 30th of June. As for the second loan, you can get it from the 1st of July to the 31st of December. Considering this is a loan, not a donation, you’ll have to pay it back when you get a job or start earning income one way or another.

Student Start-Up Loan Payment

An essential point you should consider is the Centrelink loan payment. Once you start gaining enough income, you’ll need to pay it to the Australian Taxation Office (ATO). But the good news is that you won’t be charged interest on student start-up loans, which is one of Centrelink’s best benefits.

What Are the Eligibility Criteria for Student Start-Up Loans?

Centrelink doesn’t give out student start-up loans automatically. Instead, you’ll have to make sure you’re eligible for them and then apply. Here’s a list of the eligibility criteria you should have:

  • Getting aid from Abstudy, Youth Allowance, or Austudy
  • Being enrolled in a higher education institute for full-time studies
  • Not being enrolled in a student start-up scholarship or Commonwealth education costs scholarship
  • Applying before your course ends
  • Having a Tax File Number

How to Apply for a Student Start-Up Loan

centrelink start-up loan

After you check your eligibility, you can apply for the loan on myGov through your Centrelink account. Here are the steps you should follow:

  1. Click on the drop-down menu and choose Payments and Claims
  2. Tap on Apply for/Manage Student Start-Up Loan
  3. Choose the loan periods
  4. Accept the terms and conditions
  5. Send the application

How Will I Receive My Start-Up Loan?

Since being accepted for a start-up loan depends on your enrollment in one of Centrelink’s financial aid programs, receiving the money is pretty easy. You’ll receive your start-up loan with your regular student payments at the beginning of either January or July.

When on Centrelink, you might not have enough money for white goods, car repairs, or debt consolidations. That’s where Centrelink advance payments come in handy. Instead of waiting for your payday, you can request money earlier and get instant cash. Even if you get a microloan as low as $500, it can help you if you’re in a financial pickle.

However, other loans, like debt consolidation loans and bond loans, might not be easy to get while on Centrelink. Lenders will need to make sure that you have an income source other than Centrelink funds before giving you such loans. And even if they find one, they can’t guarantee you a loan.

Guaranteed approval loans are prohibited by the Australian Securities and Investment Commission (ASIC) because lenders should run background checks and assess the borrower’s financial situation before agreeing on a loan. This includes guaranteed debt consolidation loans, emergency cash loans, and more.

student start up loan centrelink

Conclusion

Centrelink provides a student start-up loan for higher university students who are struggling with their finances. To apply for it, you must be enrolled in one of three programs, Youth Allowance, Abstudy, or Austudy. You can get the loan twice a year, and you don’t have to pay it back till you start making enough taxable income.

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