MSE News: Government: Student loan sale won't push up rates

Poolie

The Government will sell the loans at the same amount they are worth. What will happen and has happened previously is the government will pay the difference between the student loan interest rate and commerical rate. Therefore government gets it money back but has to pay the loan buyer the extra interest. SLC will still exist as they will be doing the administration while somebody else will own the loan. This has happened with Pre 1998 loans.

For the Post 1998, you have remember that HMRC are involved and they will only want to give the money to one person.

The terms and conditions have always remained the same for the repayer.

surfsister

bumpoowee wrote: »

Because the government will sell a loan worth say £20k for say £5k to the private company. The private company can then collect the full £20k and make £15k profit (of course many of these loans will never be repaid in full so they are unlikely to collect the full balance of the loan book).

I don't see why the government hasn't gone directly to the students with the same offer, eg if you owe £20k pay £10k now and your loan will be cleared. I guess labour are just keen to !!!! off the young generation even more than they already have.

This sounds the best option for students and would cheer them up immensely but the government long since gave up claim to any common sense or even sense!