Wednesday, May 7, 2008

How to find funding

If you're one of the lucky ones to get offered a place in the MiF, the first thing you need to deal with is how to come up with the cash. Everyone will face a different situation with this, but is what worked for me.

There are three thresholds that must be met: first deposit, second deposit, and remaining tuition and living expenses. The first deposit is 1,000 pounds due when you accept your offer, the second is 9,000 pounds due 6 weeks after the offer is made, and the remaining tuition, 19,700 pounds, is due at the beginning of the program. Living expenses are up to your lifestyle, but I budgeted a (lower) middle-of-the-road figure of 1,200 pounds per month.

The first and second deposits must be paid without the help of financial aid, no scholarships or student loans. Coming up with 10,000 pounds is definitely a big burden; I managed it using zero interest balance transfer and introductory offers from credit cards. I took on a very large charge on my cards this way, but I will pay back the balance when I get money from student loans at the start of the program.

I arranged student loans for the full tuition cost, including repaying my bank for the first and second deposits, as well as living expenses from Sallie Mae, an American student loan lender. Sallie Mae will lend to students of many universities outside the US; LBS is one of them. Note though that the company requires a US national as a cosigner if you are not a US national (I am). My Sallie Mae loans are actually 2 loans, one guaranteed by the US government and one not. The first loan has a fixed interest rate but has a limit of $20,500, which is not enough to pay for the program. My other loan, for the remainder, is a private loan with a variable interest rate based on my creditworthiness. With the current turmoil in the credit markets there is worry about being approved for loans, but I was approved without any issue. If you have below average credit then this may be an problem, but otherwise I don't think it's a cause of concern.

Another option for borrowing is through HSBC, which many of my classmates are taking from reading their comments. I found that the Sallie Mae application is less cumbersome and it's easier to borrow everything you need from that company than from HSBC. Sallie Mae will approve any amount you wish to borrow within a limit set by the program as the maximum cost, tuition + 20,000 pounds for living expenses, if your credit is decent. Borrowing high amounts might not be so easy through HSBC. If Sallie Mae is an option for you, take it.

All this talk of loans, aren't their any scholarships available? In short, not really. Here is a list of scholarships available through the program: Many are only offered to certain groups, women for instance, and all of the awards are made only to 1 or 2 people. That is, even if you are qualified for an award, you will have stiff competition in getting it. If you manage to get a scholarship then great, but this should not be a key part of your funding plan.

As always, best of luck.