Student loan taken from 2003, now pay until aged 65!?

Katharine1471

I've just been made aware that if you have a student loan taken from between 1998 - 2005 then you have to continue paying the student loan back until aged 65?

This is compared to those prior to 98 or post 2005 it gets written off after a time period (e.g. 25 years)

Why is it that those that fall in that window have to pay it back for so long before it gets wiped clean!?

At the time I took it out is was written that it would be written off after 25 years.

Now as a part time worker (children) my paying it back in nominal so could argue it doesn't matter that it hangs around for so long given I don't really pay much towards it, but how it reasonable I pay mine for 44 years when a lot of others pay for 25 years. Was I just completely unfortunate with the timing I went to uni!?

My student loan currently stands at just short of £20k.

Tixy

If you took out your first loan before September 2005 then you continue to repay it until you reach the age of 65.
That has always been the case for loans taken out in that time window.

Post 2005 and pre 2012 it is written off 25years after it becomes eligible to be repaid (except in Scotland where it is 35 years).

At the time I took it out is was written that it would be written off after 25 years.

Do you have any formal written documentation in relation to your loan that states this?

Cycrow

well, i think as you borrowed it, its only fair to pay it back at some point.

althou not sure why people who get it after 2005 get to right it off after a certain time, especially as its most likly to be more money. That doesn't seem all that fair.

the loans before 1998 were different thou, and i beleive also had interest on them.


Mine is the same as yours however, as i got mine in 2001

Katharine1471

not sure if I could dig anything out, but it was definitely the case it was written off after 25 years or age x (no idea what the age was because I had worked on the 25 years scenario as was applicable to me) - whichever was earliest.

Given I had graduated at age 22 I had been working on the principle by then IF I hadn't paid it off (unlikely given time out or full time working) then I'd have effectively paid them what I took and the interest would get wiped out.

Why have a window of a few years where the terms are so different?

From what I can find, the terms and conditions changed in 2006 making those under the interim system I went through on (98-05 window) then they no longer get it wiped after 25 years and pay until age 65

I have interest on mine also - agreed fairly low but still given I pay so little towards it the interest just makes it keep growing

Cycrow

the interest on student loans is nothing, its usually the rate of inflation.

so by the end, you are still only paying back what the loan is worth.

im not sure where the 25 years starts on the new system, but i assume its when you started earning over 15k and start your repayments

Katharine1471

Agreed it is low by comparison to any other loans but in 2008 it was 4.8%. (thankfully last few years has been kept much lower)

I guess I'll just have to keep paying and hope one day it is either paid off or it gets cancelled.

I will see if I can dig out any of the info I was given when I applied but I suspect I haven't kept hold of it.

I reckon assuming I pay more then my current payments, at age 65 I'll still owe about £5000. Thats assuming the 1.5% current rate will remain for the duration (which is pretty unlikely so looks like I'll still be paying until 65 and they'll still have to cancel a big chunk!)

Thanks

Katharine1471

Cycrow wrote: »

so by the end, you are still only paying back what the loan is worth.

If only the pay actually grew at the same rate to mean that the final total loan repayed really was just a reflection that it was just a figure demonstrating how much the value of money in 2003 would be in 44+ years!

R_P_W

Can I ask how much you earn? You don't have to pay it back until you reach 65 - you could always earn more money and pay it off quicker?

ch3101

How is paying it until you're 65 fair at all?

Other people will have borrowed the same amount and will have it paid off by their 40s or earlier.

Be grateful that you're going to have had money for free

kerri_gt

I don't recall that when I took my loan out (post-98) reading it would be written off after 25 yrs if i hadn't paid it back, but then the point of my degree was to hopefully help enable a salaried level where this wouldn't be an applicable point anyway.

Don't forget that our tuition fees were also considerably lower.

I guess it's a case of 'life isn't always fair' I took out the money with the expectation it would have to be paid back. Had I been in the academic year before (i.e born a month sooner) I would have received a full grant and no doubt have no student debt lingering at all.

CLAPTON

Katharine1471 wrote: »

I've just been made aware that if you have a student loan taken from between 1998 - 2005 then you have to continue paying the student loan back until aged 65?

This is compared to those prior to 98 or post 2005 it gets written off after a time period (e.g. 25 years)

Why is it that those that fall in that window have to pay it back for so long before it gets wiped clean!?

At the time I took it out is was written that it would be written off after 25 years.

Now as a part time worker (children) my paying it back in nominal so could argue it doesn't matter that it hangs around for so long given I don't really pay much towards it, but how it reasonable I pay mine for 44 years when a lot of others pay for 25 years. Was I just completely unfortunate with the timing I went to uni!?

My student loan currently stands at just short of £20k.

You really don't have a clue do you?

You don't actually know the facts about either your own loan or the changes made in 2006.


It's 'repaid' and not 'repayed.