Repaying 2 student loans

ANY_CHANCE

I have 2 student loans

1 from 1996- 1999 which i think must be a fixed term loan

and the 2nd loan 08-11 an income based loan

I have started repaying the first loan which is costing £160 per month and I am now due to start repaying the second loan which I have just learnt will be 9% of what i earn over a certain amount.

I am worried that all these monthly payments added up is really going to hurt after having to pay mortgage etc Is this a normal amount to be paying?

Do they take into account having to pay other loans off? £200 (or it could possibly be more) per month seems alot to pay back.

melancholly

the threshold for the earlier loan should be much higher than the second one, since it's a mortgage style loan. i'd have expected you to start repaying the second one first since that will be on less of an income.

i don't know how two loans on different systems works, tbh, but if you work out your income and deductions, you'll be able to work out how much this will' hurt' or not. also, google student finance and go to the directgov site to read up on this. the terms of repayment have been set out since you signed for the loan, so it's time to have a dull evening working out what this all means! although you've only just realised what the terms are, they will have told you when you initially signed up.

hopefully someone will be able to answer about multiple student loans soon. in short, the repayments won't be reduced if you have other loans. but if you are struggling to get income to over expenditure, once you know your student loan repayments, try doing an SOA (statement of affairs) from the debt free wanabee board to check how your monthly budget could be improved.

Oldernotwiser

I think you'll find the answer to your question in this fact sheet[/url] from the SLC.


http://www.studentloanrepayment.co.uk/pls/portal/docs/PAGE/RPIPG001/RPIPS001/RPIPS006/PPC%20004%20REPAYING%20YOUR%20STUDENT%20LOAN.PDF

Poolie

You would only get the option to repay one or the other if it was PGCE loan for the 2nd course. Given that it was for 3 years, I suspect this was not the case.

I suspect you could be stuck with paying both loans if you are above the earnings threshold in both cases.

Oldernotwiser

Poolie wrote: »

You would only get the option to repay one or the other if it was PGCE loan for the 2nd course. Given that it was for 3 years, I suspect this was not the case.

I suspect you could be stuck with paying both loans if you are above the earnings threshold in both cases.

That isn't what it says in the SLC fact sheet I linked to above. There it says,

"If your income is more than the threshold for deferment of the fixed term
loan, you will not have the choice of which loan you repay first.
Repayments will be expected on the fixed term and the Income Contingent
repayments will be suspended until the fixed term loan is paid in full"

Poolie

Oldernotwiser wrote: »

That isn't what it says in the SLC fact sheet I linked to above. There it says,

"If your income is more than the threshold for deferment of the fixed term
loan, you will not have the choice of which loan you repay first.
Repayments will be expected on the fixed term and the Income Contingent
repayments will be suspended until the fixed term loan is paid in full"

From the factsheet:

"WHY AM I REPAYING TWO TYPES OF LOAN?
Most people will have only one type of loan – either an Income Contingent (IC)
or fixed term (also known as Mortgage Style Loan). As you have borrowed for
more than one course of higher education, you may be due to repay both types
of loan at the same time."

The factsheet is only relevant if the second loan was for a PGCE 1 year course otherwise this fact sheet is never issued.

Therefore if the graduate is above the threshold for deferement (obviously therefore above the threshold for ICR repayment) then a deduction would be expected for both loans.

Also would have helped if you had provided the link to the PGCE section as that is the section the leaflet referred too http://www.studentloanrepayment.co.uk/portal/page?_pageid=93,5604062&_dad=portal&_schema=PORTAL

Oldernotwiser

I apologise totally.

I'd somehow managed to read that without noticing that it only applied to students who'd done a PGCE.

Thanks for the correction.