Petition for reduced student loan interest next year

Lavendyr

Running_Horse wrote: »

0% interest sounds pretty good to me. Just wait until you join the real world. Nobody is forced to go to university. It is a decision made by an adult who has weighed up the costs and benefits. I did it part time while working to avoid debts. Might have more sympathy if the full time students hadn't spent so much time and money in pubs and clubs.

I am, as you put it, "in the real world", and have also been a student, and have a substantial loan to pay off. I am fully aware that I made this decision having weighed up the costs & benefits at the time, and I am more than happy to repay the loan according to the arrangement to which I agreed when I took the loan out.

When I agreed to take out this loan, the relevant term to this discussion was that the interest rate would be based on the RPI percentage increase in March of each year, and that interest rate would be applied from the following September for 12 months. This was the arrangement that I signed up to. The aim & spirit of the agreement was that you should always pay back no more than you borrowed, in broadly "real" terms - i.e. allowing for inflation, no more.

In line with this, when inflation became deflation, the correct course of action would have been to incorporate the negative rate. This would have accurately reflected the "real" value of the loan.

Instead, the government chose to set the rate at 0%. Of course this means that one year is interest-free. However, it does NOT mean that my loan balance is moving in line with inflation - otherwise, the value of the loan would be decreased.

I can understand why some people think that students, and graduates, should be happy with their lot and should not complain - it is cheap debt, after all. But that's a completely separate argument and is not relevant. The point is that the loan agreement has effectively been changed by the government's decision not to adhere to RPI movements. And that is why I would sign the petition.

hstudent

Lavendyr wrote: »

When I agreed to take out this loan, the relevant term to this discussion was that the interest rate would be based on the RPI percentage increase in March of each year, and that interest rate would be applied from the following September for 12 months.

We were also told the government's target for RPI is 2% and this year is the first year in a long time where it's been below 2% (it's been 5% on a couple of occasions) and now they decide we can't actually have an interest rate equal to the RPI because it's too low. I think the average rate of interest while I've had a student loan is over 3% so you could say we were mis-sold on the 2% even considering this year's rate of 0%.

hstudent

malkie76 wrote: »

No problem, I'm not in any rush, just post when you have the time from a more suitable Internet connection.

It's going to be impossible to research on the web as I don't speak Dutch, German, Greek, Arabic etc. and can't speak any foreign language fluently so I can't check on what their governments' websites say that they get for university funding.

sandiep

Back to OT.

Is the issue not that if the government apply such logic to index linked loans on student loans, then they should apply same logic to index linked benefits.

vaporate

To be blunt, university fees are too high. Student loans will never be paid off.

hstudent

sandiep wrote: »

Back to OT.

Is the issue not that if the government apply such logic to index linked loans on student loans, then they should apply same logic to index linked benefits.

No because the big bold point in the Student Loan terms and conditions is:
The interest rate is set at the RPI once a year so you effectively pay back what you borrow with inflation taken in to account.

The whole point of a student loan is it is not a commerical loan so the terms have to be clear and transparent.

chabapig

hstudent wrote: »

So I hope you're even less polite to people who claim bank charges for going overdrawn are unfair as those charges are in the banks T&Cs, SLC have broken their T&Cs to make more money.

You are absolutely right. The Student Loans Company changed their terms and conditions. No wonder we now feel like muppets. We were lied to.

anyfreebies

Point well made.

housebuyer_abc

hstudent wrote: »

You do realise that many European and Asian national students studying in the UK usually get given funding, not a loan, of up to £7000 a year including their tutition fees paid. I hope you also do realise that American salaries are significantly higher than British ones so a couple of thousand is nothing to a lot of Americans.

Absolute rubbish, I've worked both here and in the US, and can say without a shadow of a doubt that outside the boardroom the average salary of a UK worker is far higher than their US counterparts

hstudent

housebuyer_abc wrote: »

Absolute rubbish, I've worked both here and in the US, and can say without a shadow of a doubt that outside the boardroom the average salary of a UK worker is far higher than their US counterparts

The fact is the average salary for a US citizen is $32,000, the average for a UK citizen is £26,000 ($29,500.) Are you proposing the boardroom people in the U.S don't have the degrees and the dustmen and waiters all do?