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  • FIRST POST
    • Gr8st33t
    • By Gr8st33t 7th Jul 17, 11:30 AM
    • 17Posts
    • 1Thanks
    Gr8st33t
    Old Student Debt Dilemma - About to expire/ Statute barred??
    • #1
    • 7th Jul 17, 11:30 AM
    Old Student Debt Dilemma - About to expire/ Statute barred?? 7th Jul 17 at 11:30 AM
    Hello,

    I have debts from student loans dating back to before 1998. To clarify, I started my degree in 1994 and my understanding is that my loans come under the 'old style student debts.'

    I have been deferring these debts every year. I have read somewhere else that after about 25 years or if I am over 50, this debt expires. I contacted Student Loans to clarify when exactly my debts would expire and was told that it would be in 2019. According to her I have an outstanding balance of £9,400, of which £4,100 are in arrears. She explained that the arrears were due to the fact that back in 2014 I had applied for deferral too late and since they can only backdate to three months the rest of the balance would be in arrears. Most worryingly, she also told me that until I clear these arrears the automatic debt expiry would NOT apply to me and the debt would still be outstanding even after 2019.

    In light of this, my question is:

    1) Is it true that if there are arrears on my old student debts, they would not expire even if they otherwise meet the criteria for expiry (25 years or debtor is over 50 years of age)? Can anyone confirm this?

    2) If it is true that my debt will not expire unless I pay off the arrears and since deferment could be regarded as 'acknowledging debt' would I be better of NOT applying for deferment this year? I am considering this option because if I already have arrears anyway I am concerned that deferring it every year would simply prolong the lifetime of this debt.

    What would be the consequences if I chose to ignore this and wait for it to become 'statute barred' (potentially another six years from now...)?

    Thank you.
Page 1
    • sourcrates
    • By sourcrates 7th Jul 17, 12:29 PM
    • 11,929 Posts
    • 11,415 Thanks
    sourcrates
    • #2
    • 7th Jul 17, 12:29 PM
    • #2
    • 7th Jul 17, 12:29 PM
    Hi,

    Student loans are subject to the Limitations act 1980.

    The difference is that pre 1998 loans can't be recovered by deductions from your wages, recent ones can.

    So any period of six years without payment or written acknowledgement would render the loan statute barred.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. I'm a volunteer to help the boards run smoothly, and I can move and merge posts there.
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
    For Legal advice see : http://legalbeagles.info/
    • Gr8st33t
    • By Gr8st33t 7th Jul 17, 1:06 PM
    • 17 Posts
    • 1 Thanks
    Gr8st33t
    • #3
    • 7th Jul 17, 1:06 PM
    • #3
    • 7th Jul 17, 1:06 PM
    Hi,

    Student loans are subject to the Limitations act 1980.

    The difference is that pre 1998 loans can't be recovered by deductions from your wages, recent ones can.

    So any period of six years without payment or written acknowledgement would render the loan statute barred.
    Originally posted by sourcrates
    Hi thanks for your reply.
    I noticed you specifically mentioned 'written acknowledgement.' Does this mean a phone call to the Student Loans company merely discussing deferment would not count as 'acknowledgement'? As I said in my original post, I had been deferring until last year. I wanted to see what would happen if I stopped deferring from now on. So, as long as I stop deferring this would reset the clock from this year towards the loan being statute barred in six years time, is that right?
    • sourcrates
    • By sourcrates 7th Jul 17, 1:16 PM
    • 11,929 Posts
    • 11,415 Thanks
    sourcrates
    • #4
    • 7th Jul 17, 1:16 PM
    • #4
    • 7th Jul 17, 1:16 PM
    You can talk about it as much as you like, only written acknowledgement counts yes.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. I'm a volunteer to help the boards run smoothly, and I can move and merge posts there.
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
    For Legal advice see : http://legalbeagles.info/
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