Changes to student finance rates, please check if this is true...

Mr_Shankly

So there's an open email to an MP from a student going viral at the moment, you may have seen it. It's about repayments for the first batch of students on the new levels of fees.

As one of said recently graduated students, I feel like I should be angry, but not sure whether it's at this supposed change in rates, or at the freezing of thresholds. The email makes a few claims I desperately want to check before I get involved, as I can't find any verification online.

1) The current rate of interest on loans until the April after leaving the course is 3% + RPI (0.9%) = 3.9%. He claims that when the loans were issued, we were told the interest would be 0.5%? Is this true?

2) 'The underhand way, the Government has sold our loans to a private company which has caused the interest rate to skyrocket'. I don't believe this has actually gone through yet, but is this what has caused the rate to change? I don't think so.


Thanks for any help.

Ed-1

Mr_Shankly wrote: »

So there's an open email to an MP from a student going viral at the moment, you may have seen it. It's about repayments for the first batch of students on the new levels of fees.

As one of said recently graduated students, I feel like I should be angry, but not sure whether it's at this supposed change in rates, or at the freezing of thresholds. The email makes a few claims I desperately want to check before I get involved, as I can't find any verification online.

1) The current rate of interest on loans until the April after leaving the course is 3% + RPI (0.9%) = 3.9%. He claims that when the loans were issued, we were told the interest would be 0.5%? Is this true?

2) 'The underhand way, the Government has sold our loans to a private company which has caused the interest rate to skyrocket'. I don't believe this has actually gone through yet, but is this what has caused the rate to change? I don't think so.


Thanks for any help.

No, both claims are complete rubbish. Plan 2 (post-2012) loans have always been communicated with the interest rate taper ranging from RPI to RPI+3% and no income contingent loans have been sold anyway (not even plan 1 loans, although the government intends to initiate a sale of the early 1998-2005 loans soon in gradual batches). The later 2006+ loans will be more difficult to sell due to the 25 year write off; with the pre-2006 loans the write-off was at age 65.