Pay back studentfinance all at once??
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Pay back studentfinance all at once??Hi,
can someone tell me whether i am able to pay back all of my loans all at once after i graduate.
for example, i loaned £8000 throughout the three years, is it possibe to send a check before i graduate and gain employement to pay the whole amount, without occuring interest. also, are the interest rates very high?
thanksLast edited by CS_Prodigy; 28-08-2010 at 00:22. -
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Re: Pay back studentfinance all at once??Don't bother. The interest rate you will get with that money in a bank savings account will beat anything SFE will charge you.(Original post by CS_Prodigy)
Hi,
can someone tell me whether i am able to pay back all of my loans all at once after i graduate.
for example, i loaned £8000 throughout the three years, is it possibe to send a check before i graduate and gain employement to pay the whole amount, without occuring interest. also, are the interest rates very high?
thanks
Pay back the minimum you have to. -
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Re: Pay back studentfinance all at once??but if my parents are willing to off all the loans at once, wouldnt it be better just to pay it all? and just out of query how much does the interest rate add on to your loan?(Original post by marcusfox)
Don't bother. The interest rate you will get with that money in a bank savings account will beat anything SFE will charge you.
Pay back the minimum you have to. -
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Re: Pay back studentfinance all at once??sorry about this, but dont really understand. you mean if i invest the £8000 into a savings account, i will earn more from that than paying them back?(Original post by spasmos)
If it gets it off of your mind, then do it - you could invest the money and earn a bit from it, but its really up to you.
If you want to pay it back, call student finance and discuss it. -
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Re: Pay back studentfinance all at once??Hmm, not that much, I'm sure you can check the interest rate on the SFE site.(Original post by CS_Prodigy)
but if my parents are willing to off all the loans at once, wouldnt it be better just to pay it all? and just out of query how much does the interest rate add on to your loan?
Much better to have the money in the bank though.
http://www.moneysavingexpert.com/loa...nt-loans-repay -
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Re: Pay back studentfinance all at once??Yes. You will get greater than the 1.5% rate in a bank.(Original post by CS_Prodigy)
sorry about this, but dont really understand. you mean if i invest the £8000 into a savings account, i will earn more from that than paying them back? -
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Re: Pay back studentfinance all at once??i see, i've read the article you've provided me, thanks. but it says that rates will be hiked up to 4.4%. i know this still quite small, but i would rather pay it all, i dont want to have any debts on my shoulder. i want to remain free(Original post by marcusfox)
Yes. You will get greater than the 1.5% rate in a bank.
but thanks marcus, will rep you for that!
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Re: Pay back studentfinance all at once??No, the 4.4% rate is for people who took out a loan before 1998.(Original post by CS_Prodigy)
i see, i've read the article you've provided me, thanks. but it says that rates will be hiked up to 4.4%. i know this still quite small, but i would rather pay it all, i dont want to have any debts on my shoulder. i want to remain free
but thanks marcus, will rep you for that!
Paying it off before you have to is a waste of money. -
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Re: Pay back studentfinance all at once??i know what you mean, its more worth investing money and earn interest from it. but i would personally like to get rid of this debt since i have some spare cash in hand(Original post by marcusfox)
No, the 4.4% rate is for people who took out a loan before 1998.
Paying it off before you have to is a waste of money. -
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Re: Pay back studentfinance all at once??Paying off your student loan should always be your absolute last priority.
It's not really a debt despite what people say and you'll never get another loan in your life with such a low interest rate. I know last year the interest was 0%, so it's never worth paying more than the minimum amount that's automatically taken from your wages. Think of it less as money you owe and more of a graduate tax on your earnings. -
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Re: Pay back studentfinance all at once??Why? There is no point AT ALL in doing this. Did you actually read the article?(Original post by CS_Prodigy)
i know what you mean, its more worth investing money and earn interest from it. but i would personally like to get rid of this debt since i have some spare cash in hand
It's like people are somehow irrationally bothered by the fact that they [shock horror] owe money and [OMG] the interest is building up! -
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Re: Pay back studentfinance all at once??ok, you've all covinced me to not repay it(Original post by marcusfox)
Why? There is no point AT ALL in doing this. Did you actually read the article?
It's like people are somehow irrationally bothered by the fact that they [shock horror] owe money and [OMG] the interest is building up! but as for savings accounts, do you think AA has a very good savings account? they offer a very high interest rate.
http://www.theaa.com/savings/savings_calculator.jsp
im looking to use the savings within 2 yearsLast edited by CS_Prodigy; 28-08-2010 at 01:19. -
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Re: Pay back studentfinance all at once??As everyone said it's better to put it in an ISA or invest, which will negate the interest rate and earn you money. It's also very useful to have money available in case of an emergency. Paying off your student loan is not a high priority.
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Re: Pay back studentfinance all at once??You misunderstand the terms of your student loan. You pay interest on it from the day you receive your first payment NOT at the end of your course.(Original post by CS_Prodigy)
Hi,
can someone tell me whether i am able to pay back all of my loans all at once after i graduate.
for example, i loaned £8000 throughout the three years, is it possibe to send a check before i graduate and gain employement to pay the whole amount, without occuring interest. also, are the interest rates very high?
thanks
You can pay off an amount at any time. -
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Re: Pay back studentfinance all at once??Well, if you invested it - whether through a savings account or a fixed bond or whatever, the interest you earnt would be more then the interest that student finance charge you - so oyu could make some money.(Original post by CS_Prodigy)
sorry about this, but dont really understand. you mean if i invest the £8000 into a savings account, i will earn more from that than paying them back? -
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Re: Pay back studentfinance all at once??(Original post by CS_Prodigy)
Hi,
can someone tell me whether i am able to pay back all of my loans all at once after i graduate.
for example, i loaned £8000 throughout the three years, is it possibe to send a check before i graduate and gain employement to pay the whole amount, without occuring interest. also, are the interest rates very high?
thanks
If you have the money I would pay it. Think about it - it's a payment of about £35,000. If you let the interest accumulate (actual figure + RPI + 3%), it, could get up to £50,000 and more! Yes you pay it off in small chunks but you'll still have extra, UNNECESSARY debt... makes no sense if you have money to spare!! -
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Re: Pay back studentfinance all at once??I don't know why you are ressurecting old threads, but anyway...(Original post by _becca)
If you have the money I would pay it. Think about it - it's a payment of about £35,000. If you let the interest accumulate (actual figure + RPI + 3%), it, could get up to £50,000 and more! Yes you pay it off in small chunks but you'll still have extra, UNNECESSARY debt... makes no sense if you have money to spare!!
People rarely have money to spare.
They don't exactly keep a spare £30K at home, stuffed inside a mattress. They use it as deposits to reduce their mortgage so they don't have as big an amount to pay back, along with interest, which is higher than that charged on a student loan.
Or other investments that provide a return on your principal.
It does not make economic sense to repay your student loan faster than is necessary, unless SF were charging commercial rates of interest, but they're not. -
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Re: Pay back studentfinance all at once??Just so you guys know, the interest rate for those who took out the loans before the tuition fee rise can be found here:
http://www.studentloanrepayment.co.u..._schema=PORTAL
I would never use my hard earned cash to pay off the loan. Unless I'm a millionaire. -
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Re: Pay back studentfinance all at once??Sorry I didn't realise this thread was so old! I was just browsing student finance links
When OP said 'spare cash', I took it as money you wouldn't miss if it was gone. My personal reasoning is that I have the money to spare and I see no point in taking out a loan unnecessarily, however exempt it is from normal loan rules. I appreciate that's not the case for some people but I was just looking at it from my POV!
Plus I think most of us at least hope to earn over £21,000, and 30 years (the time before a loan is completely wiped) is a long time.
