Should I Pay Off My Student Loan? 2008/09 article discussion

Facetious_2

Numenor wrote: »

Your starting salary will have to be over £25,000 before you'll be expected to pay off your original three undergrad loans. They will be taken from your account by direct debit over a period of 5 years.

I dont know what the position would be regarding your subsequent teacher training loans - are they from the SLC as well?

That's good news to start - it gives me a bit of leeway. As for the teacher training loans, yes, they would be provided by the SLC.

Thanks very much for your help

eldoxy24

Hi I have read over the other posts and I am just looking for some advice.

I took out a student loan in 2000 for £880, I have been in the same employment since Aug 2002.

The first ever payment I made to them was taken from my wages Apr 03 when my pay for the month was £870.75 before tax and it has more or less been taken every other month since then.

Even thou my wage is less the £15000 a month on the odd ocassion my pay is more than £1500 but way less than £20000 the payments are nearly £100 each time is this correct?


Sorry hope this is ok this time

Oldernotwiser

eldoxy24 wrote: »

Hi I have read over the other posts and I am just looking for some advice.

I took out a student loan in 2000 for £880, I have been in the same employment since Aug 2002.

The first ever payment I made to them was taken from my wages Apr 03 when my pay for the month was £870.75 before tax and it has more or less been taken every other month since then.

Even thou my wage is less the £15000 a month on the odd ocassion my pay is more than £1500 but way less than £20000 the payments are nearly £100 each time is this correct?


Sorry hope this is ok this time

I'm sorry, your post's a bit unclear. Are you saying that you've been paying back nearly £100 per month for the last 6 years on a loan of £880? Surely not?

Belfast_Boy_2

Hi folks.

I've a SL of about 13k, and have been in employment now for about 18months. About a year ago, the SLC sent me a letter saying that my employer would start making deductions from April '08.

However, no deductions have been taken from my pay as yet. I've spoken to my employer who says that the SLC/Inland Revenue haven't instructed him to make deductions to my pay as yet.

I'm wondering if:

1 - I should contact the SLC and let them know that they've overlooked me, or
2 - Say nothing and hope that they forget about me until i'm 65 (or dead ) therefore never having to pay off my loan. Is it realistic to think that I've been lost in their system and that they won't come knocking some day?

Any advice much appreciated.

Edit: I haven't had any correspondence from the SLC (statements etc) for over a year, so I don't know how much interest is being added etc or what my current balance is!

Lokolo

Even if you do come to 65, if they look over your tax records and see you have been earning more than £15k they will make you pay it then. Then with no income (as you will more likely be retired by 65), how are you going to pay it back?

Ring them up and tell them.

Miss-spent_2

Hi, This is the first time on this thread although I earlier posted on the main student thread and thank you Lokolo for the reply.
I have read through the whole of this thread and feel less panicky than I did. However all the cases here are from graduates. My son has left university after two years and will not graduate. He started in 2006 and has approx £13300 of debts. He is earning net £600 a month. Early tonight we told him that he must set up a payment of £150 a month to off set interest and try to repay capital. However reading this thread suggests otherwise.
My question is, does he have to tell SLC that he is no longer at uni. Obviously he has taken no further loans out

stb

I am repaying my student loan from overseas in a country with a low interest rate (a whopping 1.5% on my "savings" account). As far as I can see this means that (despite recent UK rate cuts) my student loan is not "free" and I should repay if I have the money. This would apply elsewhere too. Given the number of people asking about repaying from overseas, I think it would be good to explicitly state in the article that the information is directed towards UK residents, and add a note to the overseas section at the end pointing out the effect of interest rate differences. Correct me if I'm wrong about this please (I searched briefly, didn't turn up anything on forums).

Sponge

I graduated in 1996 with 4 student loans. I immediately started to defer payment and have done so every year since. It's highly unlikely I'll ever earn >£25k so I anticipate deferring payment for a long time.

So my thoughts are on the debt being, possibly, wiped clean. But I have a few questions.

Pre-1998 loans are wiped clean in the following circumstances:

• 25 years after your repayments started, even if payments have previously been defferred
• If you reach the age of 50, unless you were over 40 when you took out the loan, then it's 60
• If you become permenantly unfit to work
• If you die

'25 years after your repayments started' - but my payments never started. Can I assume this simply means the 25 year 'countdown' commences from when I graduated, i.e. when my payments were due to start?

Edit: Having re-read this bit I'm now interpreting it a different way. Does it mean the 25 year countdown starts when you make your first payment? So if you deferred for 10 years, you don't have 15 years to go, you still have 25 years, from the date of that first payment?

If the 25 year countdown started in 1996 then in 2021 (I'll be 48) whatever money I owe (the payscales in my job means this'll probably be the full amount) will be wiped clean?

If the 25yr countdown didn't start in 1996, but starts when/if I make my first payment, then taking into account the last 12 years of deferments and my current age (35), I'll be 50 years old before any 25 year clause comes into force - whatever debt remains will be wiped?

I just want to get it straight in my head and appreciate your comments.

Oldernotwiser

Miss-spent wrote: »

Hi, This is the first time on this thread although I earlier posted on the main student thread and thank you Lokolo for the reply.
I have read through the whole of this thread and feel less panicky than I did. However all the cases here are from graduates. My son has left university after two years and will not graduate. He started in 2006 and has approx £13300 of debts. He is earning net £600 a month. Early tonight we told him that he must set up a payment of £150 a month to off set interest and try to repay capital. However reading this thread suggests otherwise.
My question is, does he have to tell SLC that he is no longer at uni. Obviously he has taken no further loans out

I believe that the university will have told the SLC that he has left but it would do no harm for him to contact them. In his situation it would be really foolish to pay 25% of his income to repay this debt; I'd leave it until he earns over the threshold.

Oldernotwiser

stb wrote: »

I am repaying my student loan from overseas in a country with a low interest rate (a whopping 1.5% on my "savings" account). As far as I can see this means that (despite recent UK rate cuts) my student loan is not "free" and I should repay if I have the money. This would apply elsewhere too. Given the number of people asking about repaying from overseas, I think it would be good to explicitly state in the article that the information is directed towards UK residents, and add a note to the overseas section at the end pointing out the effect of interest rate differences. Correct me if I'm wrong about this please (I searched briefly, didn't turn up anything on forums).

The Student Loan isn't "free" because of the interest rate but because it reflects the rate of inflation; many people misunderstand this. I suppose that the rate of inflation in an overseas country might be relevant but it's the UK inflation rate that counts.