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MSE News: Student loan interest rate could fall for hundreds of thousands
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Former_MSE_Helen
Posts: 2,382 Forumite
This is the discussion thread for the following MSE News Story:
"March's inflation figures released today give a better idea of how much interest graduates will pay on loans"
"March's inflation figures released today give a better idea of how much interest graduates will pay on loans"
Read the full story:
Student loan interest rate could fall for hundreds of thousands
Also see:
2012 starters to pay 6.6% on student loans
Student loan interest rate could fall for hundreds of thousands
Also see:
2012 starters to pay 6.6% on student loans

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Comments
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As someone who got a comparatively small loan (no fees) and is only getting charged 1.5% at the moment I find the kind of debts we're putting on students now unacceptably costly.
Based on current loan sizes and interest rates you have been charged ~£2,500 before you've even left university and then face having another ~£1,000-£1,500 added each year afterwards.
Given the low interest rates at the moment anyone whose parents can are in a position to lend them the money, give them the money or even re-mortgage on a fixed rate to fund it would help their children avoid a huge debt.Having a signature removed for mentioning the removal of a previous signature. Blackwhite bellyfeel double plus good...0 -
September 2012 starters
Those who start university from September 2012 will pay interest on the loan at RPI + 3% from when they take out the loan.
It is unclear which RPI figure will be used, though it is likely to be from the previous March, therefore the rate is likely to be 6.6% from when they first draw the money, though it will change in subsequent years.
BY THE WAY
Does anybody at MSE Towers know if the £21k and £41k thresholds are going to rise annually for 2012 students because an SLC employee has adamantly told an MSE user that they aren't but MSE are informing everyone that they are?It would really helpful if someone could say something about this one way or the other....
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setmefree2 wrote: »BY THE WAY
Does anybody at MSE Towers know if the £21k and £41k thresholds are going to rise annually for 2012 students because an SLC employee has adamantly told an MSE user that they aren't but MSE are informing everyone that they are?It would really helpful if someone could say something about this one way or the other....
:happyhear0 -
melancholly wrote: »- it wouldn't remotely surprise me if they hadn't thought about it much!
Has it always been like this or is it just this govrnment that are inept - I'm not surprised they are 10+ % behind in opinion polls tbh
It would be great to get some feedback from MSE on the thresholds - even if its just to say they don't really know if the thresholds are rising.
As head of the Independent Student Finance Taskforce ML saidStudents need to know the facts, not the politics
Are the thresholds rising with inflation or not?
If the thresholds are not rising how (seriously) does ths impact the MSE student loan calculator?0 -
setmefree2 wrote: »If the thresholds are not rising how (seriously) does ths impact the MSE student loan calculator?
Massively because the amount paid back with rising wages is offset (even slightly) by the rising thresold, limiting the increase in the amount paid back each year.0 -
As someone who got a comparatively small loan (no fees) and is only getting charged 1.5% at the moment I find the kind of debts we're putting on students now unacceptably costly.
Based on current loan sizes and interest rates you have been charged ~£2,500 before you've even left university and then face having another ~£1,000-£1,500 added each year afterwards.
Given the low interest rates at the moment anyone whose parents can are in a position to lend them the money, give them the money or even re-mortgage on a fixed rate to fund it would help their children avoid a huge debt.
My generation were so lucky and I don't think we appreciated it, no fees, no loans and they even gave you grants too!Dum Spiro Spero0 -
setmefree2 wrote: »BY THE WAY
Does anybody at MSE Towers know if the £21k and £41k thresholds are going to rise annually for 2012 students because an SLC employee has adamantly told an MSE user that they aren't but MSE are informing everyone that they are?It would really helpful if someone could say something about this one way or the other....
Hiya,
We have re-checked this info with Department for Business (whose policy this is) and the info in our article is right. From 2012, every new student will start repaying from earnings of £21,000, and that threshold will rise with inflation from 2017.
Many Thanks
DanFormer MSE team member0 -
Hiya,
We have re-checked this info with Department for Business (whose policy this is) and the info in our article is right. From 2012, every new student will start repaying from earnings of £21,000, and that threshold will rise with inflation from 2017.
Many Thanks
Dan
Thank you so muchGood news or "not quite so bad" news
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Given the low interest rates at the moment anyone whose parents can are in a position to lend them the money, give them the money or even re-mortgage on a fixed rate to fund it would help their children avoid a huge debt.
I don't think that's what MSE would recommend. See the following:)
http://www.moneysavingexpert.com/students/student-loans-tuition-fees-changes0 -
'Could be deterrent'
Martin Lewis, creator of MoneySavingExpert and head of the Independent Taskforce on Student Finance Information, says: "At 6.6%, 3% above RPI inflation, while they're studying, for the first time student loan interest is at the same rate as the best buy commercial lending.
"One of my primary objections to the new system is that for the first time we are not just charging people for their education, but charging them for the financing of their loans too.
"The worry is the high headline rate of interest is psychologically damaging and acts as a deterrent.
I don't really understand why the government feel the need to charge such a high rate of interest whilst students are studying??? They must want to deter students from going to uni or they are trying to tempt parents to pay up front???0
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