At Wits End With Honours Student Loans

NotForQuitting

I have a pre 1998 student loan now with Honours Student Loans, though deferment applications are still processed by the Student Loans Company. I have not been able to get this deferred properly for several years now because SLC keep advising that my deferment application is incomplete. I am a company director though on a low income (below the PAYE/NIC threshold) and have been sending a letterhead letter declaring my income as a company director. This is the only proof of this income I am able to provide and was accepted by SLC until about 3 years ago. It was also accepted by Erudio (which is the form of proof the specifically request in lieu of employer pay slips) for my first year student loan which has just been cancelled and the account closed due to age.  It's also accepted by everywhere else I need to prove income to (including HMRC and the Council Tax office).

I have been around the block several times with the Financial Ombudsman who previously told me my complaint (about admin error at SLC, reinstatement of deferment and seeking removal of all arrears from my account) was not within time limit. In response to my most recent complaint to the ombudsman they have replied that my complain is no longer covered by the FOS.

HSL have been phoning me daily to chase the arrears on the account (just started again recently after a several month hiatus presumably due to furlough, I recognise the number so don't take their calls) and are now threatening me with a default and seeking recovery of the full loan amount. I have spoken to a solicitor about taking action against them however I would only be able to get legal aid if I am defending a claim by HSL (and I can't afford legal fees).

If it wasn't for SLC and HSL separately processing deferment and being the new creditor, I would suspect this has been done deliberately by them to prevent the loan being cancelled over the next couple of years (as will be happening with all outstanding pre-98 loans).

I am sure there must be others in a similar situation unable to approve lack of income; either low income, stay at home parent, etc. The only avenue I can think that I haven't yet exhausted is to write to my MP, though anything they are able to do is probably going to be hampered by the situation with Covid-19.

I have no intention of paying any of the loan until my income reaches the current repayment threshold (unlikely in the time left until the loan would be cancelled were it not for arrears) as this was the premise on which I took out the loan - not expecting a new creditor to be able to move the goalposts.

MalMonroe

I really don't understand this. My daughter had student loans in 1997 and she still corresponds with Erudio each year to arrange deferment. There's never been any trouble or problem. She works from home but has never earned enough to start loan repayments. Because she started Uni in 1997, Erudio is the company she deals with.

She sends Erudio copies of bank statements each year and receives confirmation of deferment shortly after. They also have her National Insurance number so it's quite easy for them to check with HMRC.

You MUST be able to send proof of income via your bank statements. Unless you don't have a bank account? And because student loan companies have your National Insurance number, they know exactly what your income is or isn't.

You say "I am sure there must be others in a similar situation unable to approve lack of income; either low income, stay at home parent, etc." - but that isn't true because most people actually CAN prove income - lack of it or whatever. It's on your bank statement. Failing that, it can be proved via HMRC.

Contact your MP but this really doesn't make any sense to me. MPs are still on duty, Covid-19 or not.

P.S. It isn't your choice when you start repaying loans because once HMRC note that you are earning above the threshold, they start the process of deducting SL repayments. Student loans are actually managed by the government. 

NotForQuitting

Actually the old style pre-1998 student loans were all sold to the private sector (Honours Student Loans and Erudio) around 7 years ago. The government have no role in the process and even before privatising, deferment and collection was dealt with by the Student Loans Company. As I said I've had no problem defering my first year loan with Erudio and my account with them has now expired due to age of the loan (they're written off after 25 years). It's a separate loan account with HSL that I cannot get defered properly.