Repayments

SOME FACTS ABOUT PAYING BACK YOUR LOANS 

Repayments start the April after you graduate – IF you are earning more than £15,000 per year. (This is equivalent to £1,250 per month, or £288 per week.) Then the repayment is based ONLY on whatever amount you earn OVER the £15,000

If you withdraw from your course BEFORE you graduate, repayments start the April after you have withdrawn – e.g. withdraw November 2009, you begin to repay April 2010

Student Loan payments are usually collected automatically, through the tax system. You do not have to set up direct debits, or anything at all.

Any disability-related benefits you receive will not be counted towards the £15,000

threshold, even if they are taxable. If the unthinkable happens, and you become in a situation

where you receive a disability-related benefit and are permanently unfit for work, your loan will be cancelled.

Once you start to pay for your student loan, then, say, you come out of work for some reason so your yearly income then drops to below the £15,000 threshold, it may be possible to obtain a refund of the monies already paid. Your re-payments would automatically stop, also.

It is also possible, if you obtain a very well-paid job and want to clear the load as quickly as possible, to pay more than the base-rate payment asked for. Obviously, this will pay of the loan quicker, but is entirely up to you.

SOME USEFUL WEBSITES 

The university of your choice website

The Student Loan Company – http://studentfinanceengland.co.uk

Aim Higher -  http://www.aimhigherhumber.org/ 

Direct gov - http://www.direct.gov.uk

www.uniaid.co.uk - a charity who help young people understand finances in a very fun way – check out the games!

EXAMPLE Repayment Figures - 2008.

How much will I be paying?

Salary of £17,000 per year.

First £15,000 per year is exempt from repayments.

Remaining £2,000 is repayable at 9% of this portion of your salary.

= £2,000 (divided by 52 weeks)

= £38.45 (9%)

=£3.46 per week repayment                 

Salary of £25,000 per year

First £15,000 per year is exempt from repayments.

Remaining £10,000 is repayable at 9% of this portion of your salary

=£10,000 (divided by 52 weeks)

=£192.30 (9%)

=£17.30 per week repayment   

SOME IMPORTANT FACTS ABOUT YOUR STUDENT LOAN REPAYMENTS

Any outstanding balance is wiped after 25 years. (or 27 years, if you took the full EMA 3 years guaranteed loan option)

Payments stop if earnings drop below the payment trigger threshold – currently £17.00 per year,  or if employment ceases

For students graduating in April 2012, the government has introduced a ‘repayment holiday’ of up to 5 years

The ‘Student Loan Company’ is responsible for the administration of Student Loans (http://www.studentfinanceengland.co.uk)

Those who are in the UK tax system will have their repayments deducted at source by their employers through their self-assessed tax returns

Extra repayments can be made to the account at any time. The usual repayment rate will still apply.

Interest is charged from day 1 of your loan

It is possible some mortgage lenders will class any outstanding student loan as a ‘debt’ when considering a mortgage application. Not all do

Any missed payments will affect your credit rating

You must give two reliable contacts on your PN1 form. These contacts are NOT responsible for any loans not paid – but they WILL be asked for information as to your whereabouts if you default on payment

Will you qualify for HE Student Finance? Check the following insert, giving general guidelines.

Do you qualify for HE Student Finance?

To qualify for student finance as a student from England, you will normally need to meet

all three of the conditions on residence. This means that on the first day of the academic

year in which your course starts, you must usually:

have been 'ordinarily resident' in the UK, the Channel Islands or the Isle of Man for the three years immediately before starting the course (and not wholly or mainly for the purpose of receiving full-time education)

be a UK national or have 'settled status' in the UK (under the terms of the Immigration Act 1971). 'Settled status' means that there are no immigration restrictions on how long you can stay in the UK.

be ‘ordinarily resident’ in England

Further help or clarification is available from Student Support helpline

0845 602 0583

Student Finance England will return student email with an invite to proceed with the student finance application – USE RELIABLE EMAIL ADDRESS!  This will probably be in February 2009

• Student completes & submits online form [PN1] – with the help of parents if possible – especially if applying for income assessed funding i.e. maintenance grant.
•  Income assessed applications will be assessed on financial year 2007/ 2008 for 2009 entry – the appropriate P60 will need to be sent as evidence. If income difference expected for year 2008 – 2009 a recalculation can be requested [i.e. less income – more grant].
•  Evidence of identity will also need to be sent if a passport number is not available and the student is sending their birth certificate. The student will need to send **ID confirmation form too [Student Finance Direct website].
• Documents sent to Student Loans Company in Darlington to support finance application should be sent via ‘special delivery’.
• On receipt of documents, the Student Loans Company will scan documents & return them to you within 48 hours.

• This form also allows you to apply for the tuition fee loan, maintenance loan, maintenance grant and extra help i.e. disabled student allowance, child care, or other dependants.