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Q: We live in Sligo and our son deferred his place from last year and is going to college in Galway in September. It is working out pricey, but we know it is an investment in his future.
We thought he would be eligible for a grant, but it turns out we are not and we are a little unsure as to how we will afford it. He is going to take out a student loan. Are there any similar credit lines available for parents of students?
A: There are credit lines for parents, according to the chief executive of the Credit Union Development Association Kevin Johnson. Credit unions offer special rates on loans for parents to help fund their child’s third-level education.
Depending on the credit union, rates can be anywhere from 6pc to 8pc APR (annual percentage rate), Mr Johnson says. This is less than a typical personal loan rate of 10pc.
These types of loans also afford you greater flexibility around terms, so you only draw down money as you need it each year.
The basics you need to apply are a copy of your son’s college acceptance letter, a payslip from your current employer, three months of recent bank statements, a form of identification, and two proof-of-address documents.
You may already be aware of this, but you might also be able to claim some Revenue relief for what you pay in tuition fees, which could help ease the financial burden.
Essentially, if your son’s tuition fees for his full-time college course are in excess of €3,000, and you pay these in full, then you can claim tax relief of 20pc of the amount over €3,000 (subject to an annual cap of €7,000).