Student loan company

Suffolk1

Hi, everyone, this is my first foray into the forums so please be kind:)

My son graduated with a 2.1 last year, 2016 after attending a 3 year course, all well and good and we are really proud of him and his success.

However, I was recently shocked to discover that as of April 2017 he already owes £5k of interest plus the original student loan, for tuition fees and living costs, leaving him with a grand total of £49k of debt!!

My husband and I are losing sleep over this as we just don't see anyway of him repaying this. He has a job abroad, teaching English and will of course make any compulsory payments required but he cannot afford to make additional payments.

I recently read a thread on this site where someone was discussing a settlement figure with the SLC, does anyone know if this can be done for more recent loans, not just the ones been sold of to E?????

Alternatively does anyone know of the best way to approach this please?

It was interesting to read the other day that the Finance companies are being made to assist credit card borrowers where only interest paymenTs have been made in the previous 18 months, my understanding is the credit card is taken back, the interest is stopped and a repayment plan is put in place. If this is correct then why can't the SLC be made to do this? should the SLC be reported to the FSA?

Any comments welcomed.

IAmWales

You're overreacting. Your son has the rest of his working life to repay the loan, if he doesn't pay it all off then it will be written off. Think of it as a graduate tax if you don't like the idea of a loan.

No, the SLC will not offer a lower settlement figure. The thread I expect you have seen relates to old debt that has been sold on.

What do you think the SLC should be reported to the Food Standards Agency for?

Honestly, stop worrying. The terms of the loan have always been known to your son, the interest should not be any shock to him.

Arleen

They did nothing wrong with the loans, so there is nothing to report, and your son knew exactly what levels of debt he is getting into.

There is also nothing for you to worry about as it's your son's debt - he should be the one worrying and look for either a better paying or second job to repay it quicker. But that is about all there is to it, as this is the price for his dream education while living away from home.

System

Student loans are effectively a graduate tax. You don't start repaying them until you earn over £21,000 a year and what you repay is 9% of gross income above £21,000 a year so if you earn £22,000 a year you repay just £90 a year. This "payment free" threshold does alter though depending on where he is in the world but he won't be paying out all his spare money.

After 30 years anything that remains unpaid is written off.