Student loan 6 years on

alexlyne

Hi All,

I graduated in summer 02, with an approx 7000 student loan.

I started my first 'proper job' in march2003, starting salary of 16K, and has gone up to 24K in the 5 years since.

I have never been chased for payments from the Student Loan Company.

I have had advice from my (now ex-) employer's accountant that if they are not chasing, do not stick your head above the wall. If the SLC wanted my money, they should be informing my employer (and not me) that money should be deducted from my wages.

I read a few years back of a similar situation. It was in one of the 'proper' newspapers money guide section. Their advice was that If SLC start chasing me now, I can complain that they should have been taking payment from me years ago, and that the interest payments are unjust, and should be removed/reduced.

Now don't get me wrong, if I wanted to pay the debt then I would have chased them years ago. Instead I decided to get a car and house, and be careful with my money instead. If they start taking payments now then I can afford it, so I'm not avoiding repayment because I'm broke.

More facts: at the moment, interest statements are still being sent to my parents home (I officially moved out nearly 3 years ago). Other than this, I was sent a form about 5 years ago asking me to detail my employment over the previous year or two (I cannot exactly remember) which I duly did. I have been using my NI number in all my jobs, and have never tried to hide myself from the system!

Any advice on whether I should get in contact with them or try to reduce the interest payments, or just carry on as I have been would be appreciated!

Thanks
Alex

St8_2

I have heard this a couple of times, and surely it is your responsibilty to get in touch with SLC to tell them about your current employment and then they will get in touch with your employer to deduct student loan repayments from your wages.

Plus, you are getting interest statements? Are these just notices of current interest rates or full statements including how much you owe? Because if they are full statements how can you complain that the interest is injust? They are being sent to your parents house because you haven't informed them that you have moved, that's your responsibily too.

celyn90

I would say it is your responsibility too. You borrowed the money, you are aware of when you have to pay it back, so pay it back. This happened to a friend of mine and when they did catch up with him they asked for the whole lot back in one go.

You should also change your address. Even if the statements are being passed to you, it is your responsibility to make sure they have the correct details.

melancholly

i'd say that if you're earning a reasonable amount you should get in touch with them and start paying it back asap. you could have paid back a sizeable chunk by now. they'll catch up with you in the end and the earlier you start paying it back, the less interest you'll end up paying.

dmg24

I agree with the others. You are an adult, it is your responsibility to ensure that your debts are paid according to the terms and conditions you agreed when taking on the loan.

I am very surprised that you consider yourself careful with money, yet choose to ignore a £7000 debt?

alexlyne

I wouldn't say I was bad with my debt. I am also not trying to renege my duty to repay back the loan, and I would not fight any demand to repay any back payments on the loan (which i reckon would be about 4K now). I know this forum is not about 'how to unfairly dodge repaying loans'.

Whilst it does not probably apply to me, the 'rules' on student loans are not to pay back more than you need, as it is a low interest loan, and there's no point paying it back if you than have to take out another loan in the future at a higher rate. The money that I have in savings is earning me interest so when they do come a-knocking, I'm not going to be any worse off.

Also, the repayment process is set up between SLC and HMRC. The employer should do nothing unless told otherwise. 'You do not need to do anything, your loan will automatically be deducted from your monthly pay'. 'If I think I should be having deductions from my pay, then I should let my emplyer know' - which I did, not long after starting with them.

I have now changed my address details with SLC, so they know exactly where I am (not that they would have had difficulty contacting me in the past).

The general consensus is that I should go about repaying the loan, and will contact them when their office is open to sort it out.

Al

Idiophreak

St8 wrote: »

surely it is your responsibilty to get in touch with SLC to tell them about your current employment and then they will get in touch with your employer to deduct student loan repayments from your wages.

Not so sure about that...it's a bit of a backward agreement.

A normal loan says "I'll take X, then I'll give you Y per month in repayment".

The student loan says "I'll take X, then I'll let you take Y in repayment"....if SLC haven't been taking the money, that's kinda their fault - the OP's not done anything to stop them....

melancholly

i think you may also need to speak to your payroll department too. it's all a bit odd really, for them to not notice for so many years. i'm always for sorting out the situation asap, and working out where you stand, rather than leaving it, so you may have some fun phone calls to make where you get passed round in circles!

alexlyne

My previous employer (up until last friday, in fact), was a 4 person business - my boss's wife did the accounts. Their accountant told them that unless they were told by HMRC to deduct anything then they shouldn't worry about it. I think from their (employer) point of view, they were happy not to deduct payments from me as it would have been a load of extra work calculating amounts etc, and more forms etc!

The info on student loans states that when my uni course finishes, HMRC are informed of my NI number, and it is up to them to monitor my employment.

alexlyne

Having spoke to SLC, they confirm that it is the IR that have messed up. I have to send my company details to SLC who will then sort it out with IR. Payments will then begin for me, with no kind of penalty. (I didn't ask about trying to remove interest payments up until now, as it is a lot cheeky) In many ways I believe that this is the best solution for me, and probably for most ex-students, who really want to focus on building their career, and getting car, house etc, but are unable to because they have to pay their student debts first - although I realise that this is probably a contentious issue!

Al

melancholly

glad it's sorted out (and also glad you didn't ask about removing interest - that's probably what got people's backs up in your first post!).

just out of interest, was it simple enough to speak to them about it?