Interest change for new 1998-2011 loans?

edited 30 November -1 at 1:00AM in Student Money Saving
3 replies 1.3K views
lazytomatolazytomato Forumite
11 Posts
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edited 30 November -1 at 1:00AM in Student Money Saving
Hi,

Don't think my title makes any sense but anyway...

I was reapplying for my student loan and the following came up on the confirmation page:
Interest
Interest is charged from when the first payment is made (to you, your university or college) until you've paid your loan back.

When you're:
  • studying, interest is charged at the Retail Price Index (or RPI) plus 3%
  • working, the interest charged will vary depending on your income

Repaying your loan
You'll only repay when you've left your course and your income is over £21,000 a year.

If you're:
  • employed, your employer deducts repayments from your salary just like tax
  • self employed, you'll repay through your Self Assessment tax return
  • planning to travel or work abroad for more than three months after you finish or leave your course, contact us for an Overseas Income Assessment form

The thing is, I started my course in 2010, so I am on the 1998-2011 scheme. My previous loans have always had 1.5% interest and I thought repay when I earn over 17,000.

I called up SFE, they said that each year I sign up to a different borrowing contract, therefore the interest and threshold varies. If I wanted to know more, I should call Bothwell Street.

This just doesn't make any sense to me. Does anyone know more about this? So confused :(:(:(

Thanks in advance!

Replies

  • Ed-1Ed-1 Forumite
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    lazytomato wrote: »
    Hi,

    Don't think my title makes any sense but anyway...

    I was reapplying for my student loan and the following came up on the confirmation page:



    The thing is, I started my course in 2010, so I am on the 1998-2011 scheme. My previous loans have always had 1.5% interest and I thought repay when I earn over 17,000.

    I called up SFE, they said that each year I sign up to a different borrowing contract, therefore the interest and threshold varies. If I wanted to know more, I should call Bothwell Street.

    This just doesn't make any sense to me. Does anyone know more about this? So confused :(:(:(

    Thanks in advance!

    If it's the same course that you're continuing the loan remains on plan 1 (i.e. currently 1.5% interest and current repayment threshold £17335).

    A loan for a new course however is borrowed under the post-2012 plan 2 scheme (higher interest and higher threshold).
  • wileycatwileycat Forumite
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    Part of the Furniture Combo Breaker
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    It does change/get reviewed every year....Its just been 1.5% now for a few years now.

    Mine started at 3% for a few years if I remember
  • lazytomatolazytomato Forumite
    11 Posts
    Tenth Anniversary Combo Breaker
    Hi guys,

    Thanks for the reply. Ed-1, you're right, I am staying on plan 1.

    My uni got involved and SFE said that they manually verify everyone when applications are submitted, so it should change back to Plan 1.

    Hope this helps with anyone else in similar situations.
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