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Student loan limit may rise from HUF 70,000 per month

Increased spending by higher education students justifies raising the maximum amount of the free so-called Student Loan1, writes economic daily Világazdaság.

Photo by Liptak Robert/Shutterstock.com

Péter Magyar, CEO of the Student Loan Center (Diákhitel Központ Zrt. or DHK for short), told the paper that it is working on new products and preparing more changes to existing loans.

Thus, if the government agrees to the plans, the maximum allowable Student Loan1 from the next school year would be higher than the current monthly HUF 70,000. The increase is also justified by the fact that nearly 80% of new borrowers already require a maximum loan limit.

On the financing side, the increase is also timely, as student loans have an earlier repayment period of eight to 10 years, and former students in the repayment phase repay on average 1.5 times the minimum monthly repayment prescribed.

Thus, the risk premium in the cost structure of student loans is minimized. The center also plans to include an adult education student loan scheme. This would be a kind of income replacement loan that would be launched in both fixed-rate and fixed-term versions, vg.hu explains.