ERUDIO student loans help

Edwood_Woodwood

anna2007 wrote: »

Whilst I understand that the Student Loan Company did not originally disclose information to the CRA’s, the fact that Erudio are now choosing to disclose the information would not appear to be a significant change in the processing of your information as this was always a possibility as a result of the terms and conditions of the contract.

Of course it is a significant change to the processing of info!

In my case, SLC did not report anything to the CRA's for 22 years yet Erudio will with just 3 years to go before write off.

The ICO is being ridiculous here.

As far as I'm concerned I took out a loan with SLC on the understanding that CRA's would not be used unless in default and this has indeed been the case for 22 years.

The above is proof itself that SLC informed me that CRA's would not be used as time has proved it itself.

Erudio, rather than SLC, will now be liable for my taking out a loan that now appears to have been misrepresented to me in the first place.

Mr_McGuffin

The provision for deferment is integral to this loan scheme. Over time it left a progressively larger proportion of remaining borrowers who will defer repayments until the loans are cancelled, as they are perfectly entitled to do. This is not only a right, it was fully anticipated and intended as the inevitable consequence of the repayment threshold.

When the scheme was introduced it was estimated that 13% of borrowers would have their loans cancelled after 25 years. A default rate of 10% was also assumed. This can be read from the figures here:

http://hansard.millbanksystems.com/written_answers/1989/jul/24/student-loans#S6CV0157P0_19890724_CWA_31

By 2013, out of the loans retained by the government after the 1999 sale, loans in deferment were 13% of the total issued. There was a default rate of 10.7%.

From the SLC figures for the year 2012-13 there were 115,000 borrowers in deferment, and 82,000 in default. The loans in deferment also represented 56% of the face value of £895m. It was costing the SLC £4m a year to administer these loans, and it knew it would be checking perennial deferment applications until 2026. This was of course the inevitable outcome of the design of the scheme as promoted and promised to Parliament and students alike.

BIS sold the opportunity to shake down this group of 115,000 blameless graduates in deferment in any way the new purchaser could get away with. While Government ministers say the terms of the loans have not been changed, this is not true, as deferment is now made conditional on acceptance of the Erudio 'Deferment Application Form' and consent to the terms within it. That is not prescribed in the 1998 Regulations and is therefore a change to the terms.

I hope everyone experiencing this outrageous situation with Erudio will make their MP aware that the loans sold to this company were repeatedly misrepresented as 'underperforming' and 'distressed' to two select committees. This was the basis of the justification for the sale given to the Public Accounts Committee in December 2013 by the Permanent Secretary of BIS Martin Donnelly and the Chief Executive of the SLC Mick Laverty, and to the BIS Committee of January 2014 by the then Minister for Universities and Science David Willetts and Executive Director Shareholder Executive Michael Harrison.

It is simply not true that the loans sold to Erudio could correctly be characterised as 'underperforming'. This was the reason given for their sale. It is a false premise. BIS and the SLC classified loans in deferment as 'in a repayment channel' and behaving perfectly correctly. From the figures of BIS itself, only 4 out of 10 of the loans sold to Erudio were in default and could be described as 'underperforming'. The majority of 60% were 'in a repayment channel' and performing correctly and as designed. BIS is responsible for all this misery and wasted time and I hope everyone concerned by this will make their MP aware of that.

Mr_McGuffin

It might seem difficult to understand now why a 'loan' was made on such generous terms, with deferment reliant on the 'honesty of graduates'.

These loans were not introduced as 'mortgage style' loans but as 'top-up' loans. They were designed to supplement a maintenance grant frozen at 1990 levels and replace benefits for students.

The scheme was proposed in a 1988 Government white paper Top-up loans for students. The new loans were designed to achieve savings 'compared with continuing the existing system of support for students’ living costs.'

It was originally planned that this 'top-up' loan scheme would more than pay for itself. Its costs were calculated with allowance made for deferment and cancellation. Deferment was integral to the model and would not affect the costs of the scheme. There were clearly anticipated levels of deferment, repayment, cancellation and default. It was a planned scheme, this wasn’t just money shovelled out with the hope it would all be paid back. It was intended that a substantial number of loans would never be repaid.

It was structurally certain that a proportion of loans would be cancelled after being deferred for 25 years. The inevitable result of the income threshold is that a number of borrowers will remain below it. That is fundamental to the nature of the loans.

It was estimated that 13% of loans issued would be cancelled after 25 years. This happens to match the proportion of loans in deferment when sold to Erudio.

As well as incorporating deferment and cancellation the scheme was also planned to produce savings over the previous systems of student support. It was predicted that savings made by freezing maintenance grants and stopping benefits for students would substantially exceed the costs of the new loans. For example, the Government estimated that in the terms, prices and interest rates of 1990, an 80% take up rate of the 'top-up' loans would produce net savings to the 'PSBR' of £147m by 2013, when compared to continuation of student support through grant and benefits.

These loans were not issued as a commercial product. They were introduced as part of higher education public policy and as a specific mechanism to reduce costs to public finances. In their own intended terms, the loans cancelled after deferment for 25 years were to be more than paid for by the operation of the whole scheme and by savings in what would otherwise have been a cost. The objectives and benefits of the scheme would be achieved with an assumed level of cancellation equal to the level of deferment in 2013.

Calling these 'mortgage style' loans helps obscure their original purpose and structure and implies they should all be repaid in full. They were designed, structured and sold on the basis that a proportion would not be repaid. A 13% cancellation rate was fully anticipated. Even a 10% default rate was allowed for. It was projected and promised that public money would be saved and Government spending and borrowing reduced at these anticipated rates.

rizla_king

Anyone know about self assessment and Erudio?

Some here needs help. https://forums.moneysavingexpert.com/discussion/5107446

TraceE_2

Sent modified deferral form monday by recorded delivery along with £1 postal order and request for original agreement.

Someone from the "deferral dept" phoned yesterday (wednesday) ..... I missed it but they asked my wife to pass on a message that "my account had been updated" ...... whatever that means.

So a very fast response but nothing on paper yet.

JeLaw

Trying to catch up on this thread. I've not had a chance for the past couple of weeks as my health's not been so good.

Had a brief skim.

I'd like to join in the legal action. Not sure if it's okay to express provisional interest? What is the latest I would need to commit by?

My financial situation is very precarious at the moment and £90 might be a stretch for me - but if my health improves I should be okay to start part-time work again, in which case I'll definitely chip in. Or if more people have joined and the amount is lower, I'd be able to chip in for a lower amount.

Regarding junk mail. I've not received anything so far. Maybe because Erudio saw my financial information and realised I wouldn't be any use to the credit card/loan companies!

Edwood_Woodwood

rizla_king wrote: »

Anyone know about self assessment and Erudio?

Some here needs help. https://forums.moneysavingexpert.com/discussion/5107446

There are lots of ways to prove one's self employment earnings are below the threshold to pay the loan and which I myself have sent to the SLC in the past and which they accepted.

This has included a WTC Award Notice and a Small Earnings Exemption Certificate, where this is only issued for earnings below £5725 for this tax year.

One can only get either by actually being in that position by informing HMRC.

Who the hell are Erudio, a private enterprise, to tell me it is not good enough, which they have now done?

StudentLoansSuck

@ weevil6969

My understanding is that an SA302 is only issued for those who file a paper tax return. HMRC has made it clear that those who file electronically, the copy you print off is an SA302. The online calculations show exactly the same thing as the paper copy. In fact when you call HMRC they will tell you amongst other things that you can login to your account and download your SA302.

“Tax calculation SA302
You can print off a tax calculation SA302 when you do your online tax return. You might need a copy as proof of income, eg for a mortgage lender. “
(as a new user I cannot post links to HMRC website)

Which is why I would challenge Erudio with an official complaint, as to why they are not accepting the copy you filed on line.

Here is a little tick that may or may not work depending on who you speak to. When you phone up HMRC to request a copy of your SA302 they will ask you if this is for a mortgage application. Say yes it’s urgent and can you have a copy faxed to you (not your mortgage broker), as well as sent in the post. They might deny the Fax request but it doesn’t hurt to try. The copy sent out in the post takes 2 weeks.

And do not full for Erudios questionable calculations. It’s Turnover –Expenses = Net Profit. Which is the figure Erudio should be taking into consideration because that is the income you have received before tax is taken off.

Nothing is ever enough for Erudio. First they demand you waste paper and print off the whole damn thing because short copy is not good enough for them. Then they demand an SA302 which regurgitates the same information you have already provided. They are acting like they are dealing with people setting up shell companies and funneling money to tax havens all for the purpose of not paying off a student loan, which was provided by the government to help with their education.

Edwood_Woodwood

With respect to the contentious issue of pre-98 loans being reported to CRA's.

The ICO state the principles that lenders and CRA's must abide by.

The first being-

1. Data that is reported on your credit file must be fair, accurate,
consistent, complete and up to date.

For 22 years the SLC did not report my student loan to the CRA's but Erudio now want to and insist they are allowed to.

This is simply not consistent with how the loan was administered for the very large part of the life of the loan.

What was consistent was that no data was reported.

I believe this fails the ICO's own principles of what can be reported.

TraceyJ_2

rizla_king wrote: »

Anyone know about self assessment and Erudio?

Some here needs help. https://forums.moneysavingexpert.com/discussion/5107446

My downloaded self-assessment form was accepted this year by Erudio. They initially sent me a letter saying I hadn't provided the required information but I challenged this via email using the relevant words from their own form (!) and they confirmed they were wrong and my deferral application had been accepted.