Jobless engineer Mr Teo who suffers from mental/physical illness received a legal letter from law firm Yeo-Leong & Peh LLC to repay $807.36 in owed repayment tertiary loan instalment to DBS bank.
He owes DBS bank the NUS Tuition Fee loan of $22,159.06 and NUS Study loan of another $16,152.69 when he completed his engineering study at NUS.
He has earned a honours engineering degree there.
Transitioning.org has introduced him a job at A2000 Solutions Pte Ltd early this year but he was terminated after working for only 26 days due to personal reasons.
Mr Teo could not hold on to a job for long period due to his physical condition – he also has abnormal bowel syndrome.
But for now, he has a bigger problem – how to repay $38,000 in tuition and study loan to DBS over the next 20 years?
We understand that for NUS study loan scheme for needy cases, undergraduates can borrow:-
a) Loan which covers 10% of the tuition fee payable by Singapore Citizens; or
b) Loan which covers 10% of the tuition fee payable by Singapore Citizens plus $3,600 living allowance per annum
The NUS website also reveals that undergraduates can borrow up to 90% of the tuition fee loan scheme (TFL).
Several conditions of repayment are summarised as follows:-
1. Repayment of the loan can be in one lump sum or by equal monthly instalments commencing not later than two years from the date that interest is first chargeable on the loan.
2. .The minimum amount of repayment is $100 per month and the maximum repayment period is 20 years.
3. .Penalty interest will be levied at the rate of 1% per month on instalments in arrears.
4. In the event that the borrower leaves the University without completing the graduate programme, the loan outstanding will immediately become due and payable. The borrower may, however, repay the outstanding sum by monthly instalments on such terms and conditions as the University may allow depending on the circumstances of each case.
According to the NUS admission website, the current fee for engineering undergraduates is $36,650 without MOE tuition grant for academic year 2014/2015.
Singapore citizens who qualify for MOE tuition grant will need to pay only $7,850 and Singapore permanent residents $11,000. International students need to pay only $15,700 if they receive MOE tuition grant.
It is also uncertain why international students are eligible for tuition grant though they pay a higher fee after subsidy.
The more important question to ask here is should the bank harassed Mr Teo who is currently jobless and suffering from mental illness to repay the total tuition fee and study loan of $38, 000?
What will the bank adopt for the next step if Mr Teo can’t pay up the accrued late payment of $807.36 – will they sue him for bankruptcy to recover the total owed amount?