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    Sorry if this is entirely ignorant .. but what is the rate of interest on your loan when you finish being a student? & at what rate do you have to pay it back ?

    & Basically.. tell me all you know about paying back your student loan!!
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    Interest is added at the rate of inflation from the minute you get your loan. So, for example, I got about £1915 at the beginning of last year; I paid it off at the start of the summer but had to pay about £1940 to clear it. I'm afraid I'm not sure about the rate of interest once you leave University though. You only have to start paying it back once you earn over a certain amount and it will automatically be taken out of your pay I believe. Have a look on the Student Loans Company website cos they've got most of the information you could ever want there!
    Hope that helps.
    Jenn xx
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    (Original post by JennLlama)
    Interest is added at the rate of inflation from the minute you get your loan. So, for example, I got about £1915 at the beginning of last year; I paid it off at the start of the summer but had to pay about £1940 to clear it. I'm afraid I'm not sure about the rate of interest once you leave University though. You only have to start paying it back once you earn over a certain amount and it will automatically be taken out of your pay I believe. Have a look on the Student Loans Company website cos they've got most of the information you could ever want there!
    Hope that helps.
    Jenn xx
    Did you pay back £1940 after borrowing £1915, or did you have to pay back the £1915 AND pay an extra £1940 as interest?

    Sorry, I don't know stuff like this. I'm just wondering how much extra we have to pay back as interest that's all. I mean, if you have to pay loads of interest, then I may not decide to take out a loan every year for uni.
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    The rate of interest on the student load is equivalent to the RPI - the rate of inflation. This is the cheapest loan one is likely to encounter in a lifetime. The interest rate is capped at the Bank of England's Base Rate. So if inflation takes off, then one won't get in too deep a hole.
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    (Original post by Pencil Queen)
    The previous poster paid back £1940 in repayment for a £1915 loan - ie s/he paid back £1915 + £25 in interest.
    WOAH. Is that it? I thought it would be more than that. So say I'm about to take out a loan of £3240 (since I live in London and staying with my parents), how much would I pay back?
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    I paid £23 a month for what seemed like forever, but was only actually 4 years! That was based on one loan of £1,100 taken out in my final year (1998-1999)
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    (Original post by Pencil Queen)
    Currently paying £96 a month :eek: for a £5000 debt (under the old system with a fixed 5 year repayment period)
    Mine was old stylee too.
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    (Original post by Pencil Queen)
    In 3 years when you start to repay it would be (roughly) £3540 (an extra £300 in interest).

    Plus £3240 + 2 years interest is £3437 + £3540 = £6977 to repay from £6480 borrowed

    Plus £3240 + one years interest is £3337 + £6977 = £10,315 to repay from £9720 borrowed a little under £600 in interest.

    It would be less than this though as your loan is paid to you in 3 installments over the year and you only pay interest on the installments as they come through (plus your final years loan is always less) - it would probably work out more like £350-£400 in interest on almost £10,000 worth of loans.
    I see. I thought it would be worse than that. I'm not going to be borrowing every year though since a relative of mine is going to help me out sometime. Although I may be going abroad in one of my years so I may actually need it!
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    (Original post by lotus_lee)
    I see. I thought it would be worse than that. I'm not going to be borrowing every year though since a relative of mine is going to help me out sometime. Although I may be going abroad in one of my years so I may actually need it!
    There's quite a few posts on this already but it seems relevant soooo...
    If you can afford to get by without your loan, it's a good idea to take it anyway and then put the money in a high interest account/ISA cos the interest you earn on it will be greater than the interest you have to pay back
    Jenn xx
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    (Original post by JennLlama)
    There's quite a few posts on this already but it seems relevant soooo...
    If you can afford to get by without your loan, it's a good idea to take it anyway and then put the money in a high interest account/ISA cos the interest you earn on it will be greater than the interest you have to pay back
    Jenn xx
    I see. Well, I dunno about that. My mum wants me to open a second account for myself and I was thinking about getting a HSBC/Natwest student account but now you have brought up the words 'high interest' and 'ISA', it has got me thinking
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    Student accounts are good in their own way - interest free overdraft for a start. Nothing to stop you getting one and changing your current bank account to one with a high interest rate, unless you are very attached to your current account of course.
    Jenn xx
 
 
 
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