FEE-HELP Changes: Loan Fee Abolished

From the Vice-Chancellor, Professor Peter Sherlock

Already recognised as having Australia’s most highly satisfied university students, the University of Divinity now offers more affordable tuition fees.

Recent changes to the FEE-HELP loan scheme mean the University of Divinity is more attractive than ever for people undertaking undergraduate studies in theology, philosophy and ministry. The cost of study for undergraduate students using FEE-HELP loans will be significantly reduced from 2019.

In August 2018 the Commonwealth Parliament amended the FEE-HELP scheme. FEE-HELP was introduced in 2005 to provide interest-free loans to Australian students undertaking courses that were not eligible for HECS.

The recent changes have two impacts upon University of Divinity students.

First, since 2005 undergraduate students using FEE-HELP to pay their fees have been charged a loan fee of 25% of tuition fees. This fee was retained by the Government, not the University, and provided no educational benefit to the student. This fee will cease to be charged to University of Divinity undergraduate students from 1 January 2019, including both new and existing students.

This is a significant saving for undergraduate students, of up to $10,000 for students enrolling in a three-year degree.

In 2019, a full-time University of Divinity student enrolled in a three-year Bachelor of Theology will be charged an annual tuition fee of $12,672 (for a total cost of $38,016 over three years at 2019 rates). The loan fee of 25% would have added a further $3,168 in 2019 (and a total of $9,504 over the three years at 2019 rates).

Second, the new changes amend the repayment thresholds for both current and past students with FEE-HELP loan debts. This means that from the 2019/2020 tax year, students and graduates will commence repaying FEE-HELP loans when their taxable income exceeds a lower threshold. Current repayment rates commence at 2% of taxable income and increase to 6% of taxable income for students on higher incomes. These rates will be changed to extend from 1% at the lowest threshold and 10% at the highest threshold. Further details will be available once published by the Commonwealth Department of Education.

Students currently using FEE-HELP, or wishing to apply for a FEE-HELP loan, do not need to take any action as these changes will be applied automatically from 2019.

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