Second year uni student and inheritance - accept student financing for year 3 or pay ?

gillmfr

Hello all,

I hope you can help.   We live in France and my daughter is just about to start her second year at Manchester Uni in September and has already accepted/applied for the student financing for year 2. 

However, unfortunately and incredibly sadly both my husband and his mother have died in the last three months so because of French Inheritance laws she will inherit quite a bit of money ... from reading around I think i understand that reimbursing her student loan is not a great idea BUT should she apply for the year three loan (2021-2022) or would she be better paying that sum directly and keeping (limiting) the loan to the approx £19000 (before interest) for her first two years ?  hope that is clear.

Grateful for any advice,

Thank you

Gill

silvercar

Sorry for your loss.
A crystal ball is needed.
You want to estimate how much of her loan she will clear; whether she will pay back a significant chunk such that all the £19000 plus interest she currently has plus a big load of the potential loan for 2021-22. She is going to be paying 9% of earnings above the threshold for a good number of years to repay the £19000+interest whether she takes it or not. Is she likely to want to buy a home? The inheritance could go a long way to a deposit and lower mortgage rate.

JayRitchie

You might not be in the standard position - has your daughter had the tuition costs loan but nothing for the maintenance loan (due to being a resident in France)? What is she studying and what are her career aspirations?