Guide discussion: Should I repay my post-2012 student loan?

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  • Ah, Peter, it’s always amusing when people who achieved far less than me professionally try to give advice like this.

    People from all over the world are still flicking to work in London because it still has far better opportunities for them than nearly anywhere else on Earth.

    You come across like a regional manager in a retail bank. There’s nothing wrong with that, it probably got you a nice house and a company car, but you need to think bigger, and not be limited by your own horizons.

    May I ask, you write like you attended a second-tier redbrick, would that be right?
  • silvercar
    silvercar Posts: 46,865
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    Tis the season of goodwill, can we try to post with respect please? Some comments come over as very aggresive/ mean.
    I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.
  • Hello All,
    I'm wanting to pay off my plan 2 student loan, I know what Martin has said about it, but I was a mature student and the final amount that I took for for the whole degree was only £12,260. The repayments start in April I am mid to high salary bracket. I've done the calculations and if I left it, it would take 11 years to pay back with quite a bit of interest.

    I think my circumstances may be different and I feel I should make overpayments over the next 18 months and save paying back over 11 years with interest?

    I would appreciate your thoughts
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  • Ed-1
    Ed-1 Posts: 3,867
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    Hello All,
    I'm wanting to pay off my plan 2 student loan, I know what Martin has said about it, but I was a mature student and the final amount that I took for for the whole degree was only £12,260. The repayments start in April I am mid to high salary bracket. I've done the calculations and if I left it, it would take 11 years to pay back with quite a bit of interest.

    I think my circumstances may be different and I feel I should make overpayments over the next 18 months and save paying back over 11 years with interest?

    I would appreciate your thoughts

    Personally I'd wait and see what comes out of the review of the system early next year. There's a high chance the interest rate will be cut.
  • Thank you for your response, I had no idea that this was the case. I’m going to do some research on it.
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  • Just quickly on something Martin said:

    "- Earn under £25,000: Interest rate = RPI
    - Earn over £45,000: Interest rate = RPI + 3%
    - Earn from £25,000 to £45,000: It rises gradually from RPI to RPI + 3%. For example, earn midway, so £35,000, and your rate'll be RPI + 1.5%"

    I'm on the highest interest rate of 6.3% but don't earn close to the £45,000 mark. Can this interest rate be changed if I ring up and question it or will I just be wasting my time sitting on hold?
  • Ed-1
    Ed-1 Posts: 3,867
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    hopelessr wrote: »
    Just quickly on something Martin said:

    "- Earn under £25,000: Interest rate = RPI
    - Earn over £45,000: Interest rate = RPI + 3%
    - Earn from £25,000 to £45,000: It rises gradually from RPI to RPI + 3%. For example, earn midway, so £35,000, and your rate'll be RPI + 1.5%"

    I'm on the highest interest rate of 6.3% but don't earn close to the £45,000 mark. Can this interest rate be changed if I ring up and question it or will I just be wasting my time sitting on hold?

    The maximum RPI+3% applies until 5th April after leaving the course. A penalty interest rate of RPI+3% also applies if you don't respond to their requests for information. Either of these apply to you?
  • An interesting discussion
    I was wanting some help to confim im correct
    Ive decided im going to pay off my student loan
    My loan is £6300
    I earn 34k a year.
    Im 25
    So as ill be paying RPI plus roughly 1.5% interest (4.5%)
    I will pay my student loan off eventually
    It would be beneficial to pay it off now??

    Would i be correct???
  • FTC
    FTC Posts: 1 Newbie
    edited 27 September 2019 at 8:00AM
    Hello,

    Do these rules still apply to EU students commencing 2020?

    Thank you.

    Filipa.
  • The House of Lords found that the current interest rate structure applied to student loans should be reviewed. See:

    moneysavingexpert.com/news/2018/06/drop-student-loan-interest-rate-to-15-says-group-of-lords/

    but this is not even mentioned in the possible subjects for the "Pick key issues for PM candidates" poll. Charging interest at 3% over RPI while the student is studying is "legalised" Usury.
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