Paing off a student loan from South Africa

stevemania1

Dear all,

I graduated from university in 2007 and immediately started teaching and as my salary was over the threshold, I started repaying my student loan straight away. At the time it was around GBP18000.

In 2011 my family and I moved to South Africa where I had a teaching post. I completed the overseas assessment form and found that again I was over the threshold so still needed to continue paying. Having moved, we deliberately left pounds in our UK accounts to cover my repayments. We also had some small help from family. The pounds have run out and to expect more help from family is asking too much of them. We are therefore left with trying to service the debt using Rands.

We have discovered how difficult it is to pay everyday expenses in South Africa using Rands, let alone paying my student debt as well using Rands. In fact, it's proving to be impossible.

I contacted SLC today to try to find a way to reduce my payments to something more manageable. At present I need to find the equivalent of GBP89 each month which at the current exchange rate is around R1500 a month. I was hoping to halve this at the very least otherwise I risk going into arrears! I said that I wanted to be proactive and wanted to avoid this situation. I was told that if I go into arrears, the SLC will contact me requesting payment and if none is forthcoming they then hand this over to a debt collecting agency. This is a nightmare scenario! I have never defaulted on a loan and don't intend to start now.

We can't afford the current payments but have been told that we can't reduce them either. I would appreciate any help that anyone can give me.

Thanks all.

Arleen

If you cannot afford to pay under your current agreement and they are not willing to give you any sort of holiday then you will have to default on it or find the missing amount of money somewhere else. Although it seems weird that you have to repay student loans beyond what is affordable, are there not some money you can save in monthly budget?

ViolaLass

If you're paying £89 a month, that suggests you have a salary of c£19k. First thing, is that correct?

Could you or anyone in your family earn more?

BrassicWoman

looking at comparative cost of living that doesn't seem excessive

https://www.numbeo.com/cost-of-living/country_result.jsp?country=South+Africa

What is causing the issue? Low salary? Supporting other people? Exchange rate tanked?

badmemory

What exchange rate are SLC using for income. I'm sure I read somewhere that they are using totally unrealistic ones.

stevemania1

We unfortunately have to pay school fees which work out at about one third of my net income (SA state schools are generally of a poor standard so we have to go private). Medical aid is about one quarter of my income. (from memory National Insurance was a much smaller percentage of my salary in the UK). Food is ridiculously expensive too.

Comparatively I'm earning much less here than I was 6 years ago in the UK. The exchange rate is volatile. At the moment it's about 17 to 1 but has been as high as 25 to 1 I think.

ViolaLass

If you're struggling so much in SA, is it the right decision to remain there? (I appreciate it's not as straight forward as that but it's a question to consider)

Could you get a better paying job?

BrassicWoman

The student loans people will not really care that you would like to prioritise discretionary health and education costs ahead of the legally binding agreement you took out with them.