Will the HELP and VSL changes affect your ECEC studies in 2020?

In August 2018, the Australian Government announced a number of changes to student loans, which may impact those choosing to study early childhood education and care. A number of the changes are due in 2020, meaning they may impact the course and institution choices made by those pursuing further early childhood education and care (ECEC) studies, or making choices about how debt is repaid. 

Changes include a new lower minimum repayment threshold, an increase to the FEE-HELP loan limit, a combined, renewable loan limit, and removal of a loan fee for some students.

Those interested in studying a Bachelor of Early Childhood at the University of Notre Dame Australia, or pursuing a specialisation at Torrens University may be interested to know that they will no longer be charged the 25 per cent FEE-HELP loan fee when studying an undergraduate course.

The upper FEE-HELP loan limit has increased substantially, now sitting at $104,440. The minimum HELP repayment threshold has been readjusted to $45,881 with a 1 per cent repayment rate. 

Those who earn $45,881 per annum pay less than $9 per week, while those earning at the upper threshold limit of $134,573 have a ten per cent repayment rate.

From 1 January 2020, a combined HELP loan limit will replace the FEE-HELP limit and will include HECS-HELP, FEE-HELP, VET FEE-HELP and VET Student Loans. Only new HECS-HELP loans incurred from 1 January 2020 will be counted towards the limit.

Any existing FEE-HELP, VET FEE-HELP or VET Student Loans taken out prior to 2020 will count towards a new HELP balance. From 1 January 2020, those with a HELP debt can top up their HELP balance by making repayments on their debt.

Repayments starting from the 2019-20 income year will top up a person’s HELP balance. Any compulsory or voluntary repayments can be re-borrowed in the future, up to the current HELP loan limit.

From 1 January 2020, the FEE-HELP loan limit will become the combined HELP loan limit and a person’s FEE-HELP balance will become their HELP balance. 

For information on the new combined, renewable HELP loan limit, please see 2020 loan limit changes on the Study Assist website.