Student Loan Repayment-time issue ?
18 October 2008, 01:42 PM
#1
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Student Loan Repayment-time issue ?
A student leaves university and enters paid employment, all legit, income tax, paye, superannuation etc, all above board, all paid/declared, address OK etc.
Leaving aside the moral issue....
If the 'Student Loan Company' (think it's them ? ) then fail to contact the student for repayment of loan from earnings, how long has to elapse before the original student loan is declared void ( or whatever) and no repayment can be reclaimed because of the passage of time ?
Cheers
JBL
Leaving aside the moral issue....
If the 'Student Loan Company' (think it's them ? ) then fail to contact the student for repayment of loan from earnings, how long has to elapse before the original student loan is declared void ( or whatever) and no repayment can be reclaimed because of the passage of time ?
Cheers
JBL
18 October 2008, 02:00 PM
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To be honest i think the loan is still active no matter how long, but i have heard that the student loan company are in a real shambles and don't really know whats going on, so if you haven't been contacted by them when you start earning then chances are you wont. I could be wrong though.
18 October 2008, 02:17 PM
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Normal debt is "Statute barred" after 6 years of zero contact. Government debt is exempy, however, they lose powers of using any strong arm tactics after the 6 year period AFAIK.
Not sure where student loan fits into it all though.
Not sure where student loan fits into it all though.
18 October 2008, 02:49 PM
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All student loans have a finite lifespan but how long they last depends on the type of loan you’ve got and when you took it out, as the Government doesn’t change the rules retrospectively.
Pre-1998 loans are wiped clean in the following circumstances:
* 25 years after your repayments started, even if payments have previously been defferred
* If you reach the age of 50, unless you were over 40 when you took out the loan, then it's 60
* If you become permenantly unfit to work
* If you die
Loans taken between 1998 and Sept 2006 are wiped clean in the following circumstances:
* When you reach 65
* If you become permenantly unfit to work
* If you die
Loans taken after Sept 2006 are wiped clean in the following circumstances:
* If they're not repaid 25 years from the first April of graduation
* If you become permenantly unfit to work
* If you die
Pre-1998 loans are wiped clean in the following circumstances:
* 25 years after your repayments started, even if payments have previously been defferred
* If you reach the age of 50, unless you were over 40 when you took out the loan, then it's 60
* If you become permenantly unfit to work
* If you die
Loans taken between 1998 and Sept 2006 are wiped clean in the following circumstances:
* When you reach 65
* If you become permenantly unfit to work
* If you die
Loans taken after Sept 2006 are wiped clean in the following circumstances:
* If they're not repaid 25 years from the first April of graduation
* If you become permenantly unfit to work
* If you die
18 October 2008, 04:22 PM
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Pimmo it depends on how much you earn, i only get the statement come through because they have already taken the money out of my wage before i get it, so id check your pay slips, they only take out a small amount each month anyway. Thank god i have only got a years worth of loan to pay back...
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18 October 2008, 08:01 PM
#8
Pimmo it depends on how much you earn, i only get the statement come through because they have already taken the money out of my wage before i get it, so id check your pay slips, they only take out a small amount each month anyway. Thank god i have only got a years worth of loan to pay back...
As far as I know its 15k+ to pay back ??
I;ve earned quite a bit more than that for the last 2 years ... I'm not complaining though
18 October 2008, 08:45 PM
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My Neice finished Uni a couple of years ago and was complaining the other week about having to pay off her student loan. I thought it was a trivial ammount per month out of the £35K+ shes earning.
18 October 2008, 09:06 PM
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Student loans are a chuffin scam and you're being ripped off. If you're not paying it off then the interest is being heaped on and you'll end up paying back alot more than you borrowed.
It's the taxman who collects the money not the SLC and he takes approx 3% of your salary each month and earns interest on your money as they will take all 12 installments before giving the SLC 1 annual payment, the SLC charge you interest on the full amount for a full year and as the interest on the loan is being calculated daily you're paying interest on your interest over the year.
As the current interest rate is 4.8%, and given the way the repayments are structured it's one of the most expensive loans you can get.
It's the taxman who collects the money not the SLC and he takes approx 3% of your salary each month and earns interest on your money as they will take all 12 installments before giving the SLC 1 annual payment, the SLC charge you interest on the full amount for a full year and as the interest on the loan is being calculated daily you're paying interest on your interest over the year.
As the current interest rate is 4.8%, and given the way the repayments are structured it's one of the most expensive loans you can get.
18 October 2008, 09:21 PM
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Student loans are a chuffin scam and you're being ripped off. If you're not paying it off then the interest is being heaped on and you'll end up paying back alot more than you borrowed.
It's the taxman who collects the money not the SLC and he takes approx 3% of your salary each month and earns interest on your money as they will take all 12 installments before giving the SLC 1 annual payment, the SLC charge you interest on the full amount for a full year and as the interest on the loan is being calculated daily you're paying interest on your interest over the year.
As the current interest rate is 4.8%, and given the way the repayments are structured it's one of the most expensive loans you can get.
It's the taxman who collects the money not the SLC and he takes approx 3% of your salary each month and earns interest on your money as they will take all 12 installments before giving the SLC 1 annual payment, the SLC charge you interest on the full amount for a full year and as the interest on the loan is being calculated daily you're paying interest on your interest over the year.
As the current interest rate is 4.8%, and given the way the repayments are structured it's one of the most expensive loans you can get.
.
18 October 2008, 09:24 PM
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They've just decided it's time to start taking money off my sister for her student loan... it's only 6 years since she graduated. 
She tried contacting them years ago to start payments, but after several attempts that got nowhere, she gave up trying and waited for them to contact her.
She tried contacting them years ago to start payments, but after several attempts that got nowhere, she gave up trying and waited for them to contact her.
18 October 2008, 09:24 PM
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18 October 2008, 09:33 PM
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There are two main measures of inflation, the CPI, which is a complex official measure standardised across Europe, and the Retail Price Index (RPI), which measures the value of a large sample of typical goods. The student loan rate is based upon the RPI.
Imagine you borrow £100, and the interest rate you pay is set at this 4% rate of inflation. That means in a year's time you will owe £104. Yet due to inflation, a basket of shopping costing £100 this year will cost £104 next year. Therefore you were lent a 'basket of shopping's worth' of money and still owe a 'basket of shopping's worth' of money, thus your actual spending power hasn't been diminished by the loan and there's no 'real' cost.
Compare this to a higher than inflation rate loan, say 10%. Here you'd owe a ‘basket of shopping's worth' plus £6. Hence to repay that money you'd need to forgo £6 of other spending.
Based on a pure financial analysis, a loan this cheap shouldn't really be paid off more quickly than is necessary.
Taken from MSE
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