student loan - calculating the cost of additional loan taken due to injury and deferrment

TC77

Helping someone calculating the financial loss of an accident which meant they couldn't sit a july exam and had to defer a year so had a half term loan for illness and then a term loan to take the exam which should have been in July (at no extra cost) but will be paying interest from what would have been their 2nd year but actual year 2 started year after and assume as a nurse that won't pay all back. How do they calculate the cost of the extra loan and interest over 30 years? All help appreciated.

silvercar

Should be easy to quantify the lack of income by not being able to start as a qualified nurse until X months later.

from what you say you assume the loan will eventually be written off, so loan payments won’t change, being 9% of earnings over the threshold until write off.

TC77

Thanks, is the assumption that interest will be 6.9% ( I think it is now) on an ongoing basis and is compound so I would add this to this part of the loan element. Apologies if I'm making it more complicated than it is.

silvercar

TC77 said:

Thanks, is the assumption that interest will be 6.9% ( I think it is now) on an ongoing basis and is compound so I would add this to this part of the loan element. Apologies if I'm making it more complicated than it is.

Unless the loan is being cleared in full (crystal ball territory, but you say a nurse, so possibly never expecting to clear the loan and more than likely anything owing at right off would be written off) then the interest being charged doesn't matter as it will all be written off at the end of the day. 

So they may be charged interest but that just makes the loan size increase and the amount written off larger.

What is quantifiable is that they start earning a nurse salary of X from date Y and that date Y is now pushed back by a year.