Student Loan Arrears

Hummingbird18

Hello all. I have arrears of around £350 on my student loan account from when I worked abroad a few years ago. I wasn't paying anything at first and then when they tracked me down they backdated it. I returned home and it has appeared on my account ever since but they've never chased me for it other than making me aware I owe it when I speak to them on the phone for another reason. I have also been paying my loan back through my wage consistently. Now I am in a stable financial position I am wondering if I should pay off the arrears or just leave it until they chase me for it? I will never pay off my loan fully so it will get written off in about 15 years. I just don't like the idea of having a debt as I am otherwise debt free and don't want bailiffs turning up on my door one day! So I'm just wondering if anyone has been chased for arrears on their student loan?? Thanks in advance for your advice. 

kaMelo

Hummingbird18 said:

Hello all. I have arrears of around £350 on my student loan account from when I worked abroad a few years ago. I wasn't paying anything at first and then when they tracked me down they backdated it. I returned home and it has appeared on my account ever since but they've never chased me for it other than making me aware I owe it when I speak to them on the phone for another reason. I have also been paying my loan back through my wage consistently. Now I am in a stable financial position I am wondering if I should pay off the arrears or just leave it until they chase me for it? I will never pay off my loan fully so it will get written off in about 15 years. I just don't like the idea of having a debt as I am otherwise debt free and don't want bailiffs turning up on my door one day! So I'm just wondering if anyone has been chased for arrears on their student loan?? Thanks in advance for your advice. 

Without knowing what type of loan it's difficult to say what will happen however, unless it's the old mortgage style loan then the amount in arrears will never be wiped, you will always have to pay that back. If it's the old style loan it could even prevent the loan being wiped at all.
SLC will not chase you for arrears, they will just keep taking their prescribed 9%. It's your responsibility to keep your account up to date and if it's in arrears the onus is on you to correct it.  For what is, in reality, a trivial sum it would make sense to pay it off to prevent any problems later on.

Hummingbird18

I think I am on plan 1 pre-2012

kaMelo

Hummingbird18 said:

I think I am on plan 1 pre-2012

If plan 1 then the dates matter, anything pre-September 2006 has a different cancellation date 

From the terms and conditions.


For both plans arrears amounts are always owed and will never be cancelled. Potentially it could have worse consequences as laid out in the next section. 




Worse case scenario is the loan doesn't get cancelled and court action taken to recover the entire loan amount owed. However unlikely it may be it's in the terms and conditions agreed to when the loan was taken. I would be amazed if SLC took this step of enforcement however there is always potential for these loans to be sold to some third party. It's these third parties whom I'd be more concerned about enforcing such a term.  

You don't think you'll pay the whole loan off within the timeframe before it gets cancelled, the arrears could potentially prevent that happening and you're liable for the entire amount borrowed. Is it worth that risk for what is a relatively small sum?