Shall I pay off existing debt with my student loan?

kimbena

I have recently applied to do a part-time PGCE (as a second degree). I am working full time and my employer releases me half a day a week to do the course - hence I am earning a full wage.

The student loan company has still offered me a loan of nearly 6K! I'm thinking I should take it even though I don't need it because the interest rate is so low. But would it be wise to pay off my existing bank loan (interest rate around 7%) with the student loan? I have checked and the bank don't charge for early repayment on the loan.

It seems like an obvious decsion to me - but for some reason the university I am doing the PGCE at has issued student finance leaflets advising students not to pay off existing debts with their student loans. I can't think why this might be. Any ideas?

Beckymarshall07

I'm guessing they dont want you to pay off debts with student loan in case you get into financial strife only to come knocking for a crisis loan from the university. But as your pretty solvent personally I'd be tempted to pay of debt with loan as its at lower level of interest rate and student loan isnt classed in same way as being debt if you ever wanted to go for a mortgage or credit in the future. I'm far from being an expert tho! Just depends how much you need to pay off. Just be careful tho with how you will juggle work and study as I did PGCE in FE part time and did take some devotion - will you def be able to maintain working 4 days and then studying? What about your teaching placements and time commitment to them?