Student loan re-payment

Buffman · 23 Apr 2014 at 22:37

Holy moly at 1.5 percent I'll be getting charged an extra 120 a year in interest :O

D.P. · 23 Apr 2014 at 22:46

mpledge52 said:
A student loan is considered separately from a normal loan when it comes to mortgages though. As others have pointed out, if you lose your job, you don't have to to pay your student loan.

Yes having a SL reduces the amount of cash you have to spare each month so this will obviously reduce the amount you can pay back each month, but in the eyes of a mortgage provider, 20k of student loan is much more preferable to 20k of a normal loan.

That makes sense but the monthly deductions are still considered.

DJMK4 · 23 Apr 2014 at 22:49

Wish I took the Max out and stashed it away for a deposit.

1.8 or 9 left to go but doesn't bother me don't notice it

interest is low and repayments are much higher which is good

[TW]Fox · 23 Apr 2014 at 23:30

The Craig said:
Holy moly at 1.5 percent I'll be getting charged an extra 120 a year in interest :O

Exactly, which is nothing.

Buffman · 23 Apr 2014 at 23:40

[TW]Fox;26203950 said:
Exactly, which is nothing.

It seems like a lot to me!

At least I've got a job lined up at the end of it all

estebanrey · 23 Apr 2014 at 23:46

The Craig said:
It seems like a lot to me!

At least I've got a job lined up at the end of it all

In real terms it's nothing. Inflation is very low at the moment and at 1.6% means the real interest currently is 0.1%

[TW]Fox · 23 Apr 2014 at 23:51

The Craig said:
It seems like a lot to me!

£120 interest on what, £15k, is not 'a lot'.

Energize · 23 Apr 2014 at 23:54

D.P. said:
Note, I had every intention of paying back the loan but I didn't want to do it my monthly directly debits room my swiss account because I would get charged 25 quid for each transaction. When I spoke to them they were adamant that no other arrangement could be made such as paying a lump sum twice a year, even overpaying the lump sum.

I would say I'm not paying then lol. Failing to pay back a loan is not a criminal matter, it's a civil one, they really have no power to get the money back once you've left the country. In fact refusing to accept legal tender as payment for a debt invalidates the debt.

estebanrey said:
In real terms it's nothing. Inflation is very low at the moment and at 1.6% means the real interest currently is 0.1%

I wouldn't call inflation very low, unless you are talking about the governments discredited CPI measure of inflation.

Buffman · 23 Apr 2014 at 23:58

[TW]Fox;26204026 said:
£120 interest on what, £15k, is not 'a lot'.

Only 7.5k

(I used calculator on 8 however..) not bad for 5 years uni!

However yes I agree it's a good loan and I don't regret taking it in the slightest (in fact saved a couple k of it)

On the plus side on my salary it takes away just over a tenner a week (800 odd a year)

pitchfork · 24 Apr 2014 at 08:07

I just think of it like Education tax, I wanted to better myself so the government is taking a big wet bite out of my ass.

Just be glad you don't have career development loan payments too.

randomshenans · 24 Apr 2014 at 08:08

estebanrey said:
When I got my student loan I was specifically told by the advisor that any outstanding amount is written off if you emigrate (leave the country for 10 years or more).

Also, student loans don't have guarantors.

I'm up to over 3yrs, I won't be going back for another 7, easily, so that'll suit me fine

No idea what mine is left tbh though. Not found me here yet but they did track my mate down in China!

Mr-White · 24 Apr 2014 at 08:24

I'm planning on paying all mine off this year just to get it out the way.

MW

randomshenans · 24 Apr 2014 at 08:29

D.P. said:
I emigrated and was hunted down by SLC, as were my parents who were on the contact information and they started receiving letter for court appearance that if I did not provide contact information they were authorized to seek repayment from my parents!

A lot of the rules change regularly; the 10 year rule was scrapped some time ago.

Dammit. They're totally coming for me

estebanrey · 24 Apr 2014 at 08:40

randomshenans said:
I'm up to over 3yrs, I won't be going back for another 7, easily, so that'll suit me fine No idea what mine is left tbh though. Not found me here yet but they did track my mate down in China!

As I was shown above sadly the 10 yer rule doesn't exist anymore so it will depend on when you took your loan out :mad:

randomshenans · 24 Apr 2014 at 08:46

If I keep running...

I could well pay it off by overpaying. I'll wait until they start screaming at me.

alx · 24 Apr 2014 at 08:54

I do wonder what they could actually do if you refused to pay whilst living abroad.

Obviously it would cause a lot of a problems if you ever moved back to the UK, but if you never did what could they realistically do?

Kemik · 24 Apr 2014 at 08:55

Participant said:
Boggles the mind that HMRC only tell SLC what you've repaid at the end of every tax year! I'm sure there's a great reason :S.

It was previously because HMRC only knew the final amount you had paid at the end of the year. Real-time reporting requirements should get rid of this over time.

In regards to the OP, it would be silly to pay off the student loan before you have to. There are various more options that pay more than your interest on your student loan. While the rate is less than inflation, inflation itself is devaluing the loan.

Even if you don't look at long term savings options, the liquid cash is much better than paying off the debt. It's just a silly idea paying it off early (except for where payments < one year left).

A2Z said:
Ive got about £9k loan, I graduated in 2008.

Since then I had pretty average jobs maxing out at about £20k a year pay so havent been paying much back...they sent me a statement recently and the total Ive paid back is nearly exactly the same as the interest I have been charged....so I have basically paid nothing back really...

Since I got a new job few months ago they are taking about £100 a month...seems like such a waste...Im also tempted to just pay it all back...otherwise will take 7.5 years

In real cash terms you are paying it off as inflation is devaluing the loan. It might sound like a lot and repayments are taken into consideration when you apply for a mortgage (they look at your net salary), but it isn't doing any harm just sitting there. If it will take you ages to pay off, it will take you almost as long to save that cash back up again with current interest rates.

Mr-White · 24 Apr 2014 at 09:20

alx said:
I do wonder what they could actually do if you refused to pay whilst living abroad.

Obviously it would cause a lot of a problems if you ever moved back to the UK, but if you never did what could they realistically do?

They'll catch you when you return for your free health care while on "holiday"

MW

sports_brah · 24 Apr 2014 at 11:47

I started University in Oct 09. I should probably find the details of how much I (should) repay.

I left to go back home.

Energize · 24 Apr 2014 at 13:49

alx said:
I do wonder what they could actually do if you refused to pay whilst living abroad.

Obviously it would cause a lot of a problems if you ever moved back to the UK, but if you never did what could they realistically do?

Realistically, nothing. There are people out there with enormous court judgements against them and nothing happens, for a civil matter no one is going to be extradited or even denied entry into another country.

Student loan re-payment

Thug