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

Chris2685

Well I meant basically:

How is helping 'themselves' (where I was referring to the student loans comapny) anything to do with helping 'us' (where I was referring to the students).

atypical

Just found an article here. Speaking in November last year:

A spokesperson for the Department of Universities, Innovation and Skills (DUIS), which sets the rates for student loans, explained RPI will continued to be used – even if it drops to zero.

He said: "We always use RPI to set rates on student loans and this remains the case." However, the department seemed unsure about how to deal with a case where RPI is negative.

"Ministers will be considering options should RPI ever to go negative and will make a decision in due course," a spokesperson later said.

"Considering options" - doesn't sound very optimistic for negative loan rates.

edit: I just sent an email to the DUIS asking them to confirm what the interest rate would be in such case that the RPI were negative in March. Will let you know should I get an answer.

Oldernotwiser

Chris2685 wrote: »

Well I meant basically:

How is helping 'themselves' (where I was referring to the student loans comapny) anything to do with helping 'us' (where I was referring to the students).

Student Loans are provided by the taxpayer (ie "us") so if anyone cheats the SLC then it's just cheating all of us who pay taxes! The SLC are not a bank, they're funded by the government from our taxes.

himoverthere

Can anyone advise me please?

I started Uni Oct08

I have since worked various jobs up and down the £15k threshold.. But to my knowledge I have never paid a single repayment. I'm currantly earning £24k and expected to start seeing repayments at some point, but nothing has ever been taken. Obviously I have an NI number and was told years back it would always be taken automatically out of my pay.. This has never happened..

I am repaying other dept at the minute and need every penny I'm earning so am loathed to start repaying.. But if I do get in contact with the SLC, can they only ask for the standard repayments? I.E. they are not going to ask for any back pay are they?

Why have they never taken anything from my pay automatically?

Thanks to any one that can help answer...

Oldernotwiser

Could you clarify the dates you were at university; I think you must have made a mistake in your post.

himoverthere

Oldernotwiser wrote: »

Could you clarify the dates you were at university; I think you must have made a mistake in your post.

Yes my mistake - started 98

argood

himoverthere wrote: »

Yes my mistake - started 98

Your NI number is supposed to be matched up automatically by HMRC however sometimes this doesn't happen OR it happens for a graduates first job out of uni and then the details don't transfer between employers.

So, if you're keen on starting your repayments (and I'm sure you're peachy keen ) then you can ask SLC to send a start notification to HMRC who will then contact your employer. When your deductions do start they will NOT be backdated, they will just start from scratch.

himoverthere

thanks for your reply..

Now I understand I have a commitment to repay my loan, however evil I think it is to effectively force the poorer of us into debt to get through a degree... and yes I had a job while studying!!

But what is the worst that can happen if I simply do nothing? I can't afford the additional income deduction at the moment, and having not thought about it for the past few years, I'm thinking leave it alone until Im in a better state to repay it..

argood

himoverthere wrote: »

But what is the worst that can happen if I simply do nothing? I can't afford the additional income deduction at the moment, and having not thought about it for the past few years, I'm thinking leave it alone until Im in a better state to repay it..

Well, the worst that will happen is that your loan will continue to accrue interest (as it has done since you first received a payment in 1998) and then when you start to repay it will take you longer to pay it off.

That's really the worst that will happen.

Jam13_2

Hi all, I would like some advice if that's okay

I currently a second year student and I have a student loan with half paying my university fees and half going into a bank account and being invested. I am lucky and have inherited a reasonable sum of money so don't need the loan to live off.

Is it advisable to pay off the loan? I know that the interest rate is 2% but I could probably only get 3.5% interest on that money. With inflation at 3% am I losing 1.5% a year??