Fees/funding

I would appreciate some advice on obtaining a student loan, and the consequences if any, of having to paying it myself?how is it with other students ? Have any students been liable for payment?? That you know?thanks, w.t (ex student)

Reply 1

olivialeighflet

I'm assuming this is within the UK so I'm just going to tell you what I know for the UK - it will probably be different in other countries. Your eligibility on a student loan depends on your university or college, your course, whether or not you've been in higher education before, your age and nationality/residency status. you’ll usually only get student finance if you’re doing your first higher education qualification - even if your previous course was self-funded. You may still be eligible for limited funding in certain circumstances and for some courses. You can apply for full support if you're a UK/Irish citizen, have no restrictions on how long you can stay in the UK, you normally live in England, and you've been living in the UK for 3 continuous years before the start date of your course (not including things like holidays). You can also get full support if you're a UK national and have lived in the EU but returned by 31 December 2020. There are some other residency statuses that can give you eligibility for full support. Have a look at https://www.gov.uk/student-finance/who-qualifies for the full information.

In terms of paying it back, you will only have to pay back student loans, maintenance loans and postgraduate loans if you are granted them. Other things like grants or bursaries you won't have to pay back (unless there's a mistake and you've been paid too much). When you have to pay back your student loans depends on your repayment plan. There are 4 repayment plans. Plan 1 applies if you're an English or Welsh student who started an undergraduate course anywhere in the UK before 1 September 2012, a Northern Irish student who started an undergraduate or postgraduate course anywhere in the UK on or after 1 September 1998, an EU student who started an undergraduate course in England or Wales on or after 1 September 1998, but before 1 September 2012, or an EU student who started an undergraduate or postgraduate course in Northern Ireland on or after 1 September 1998. Plan 2 applies if you're an English or Welsh student who started an undergraduate course anywhere in the UK on or after 1 September 2012, an EU student who started an undergraduate course in England or Wales on or after 1 September 2012, or someone who took out an Advanced Learner Loan on or after 1 August 2013. Plan 4 (they skip the number 3 for some reason) applies if you're a Scottish student who started an undergraduate or postgraduate course anywhere in the UK on or after 1 September 1998, or an EU student who started an undergraduate or postgraduate course in Scotland on or after 1 September 1998. The last plan is the Postgraduate Loan repayment plan, and it applies if you're an English or Welsh student who took out a Postgraduate Master’s Loan on or after 1 August 2016, an English or Welsh student who took out a Postgraduate Doctoral Loan on or after 1 August 2018, or an EU student who started a postgraduate course on or after 1 August 2016.

You'll only repay your loans if you income is over a certain threshold for your repayment plan. The thresholds change on 6th April every year. The earliest you'll start repaying is the April after your course, or the April 4 years after your course started if you were a part time student provided that your income is over the threshold. If you're repaying, your repayments will automatically stop if you stop working or if your income goes below the threshold.

So the thresholds: if you're on plan 1, you'll only repay if your annual income is over £19,895 a year (before tax and other deductions); for plan 2, you'll only repay if your annual income is over £27,295 a year (before tax and other deductions); for plan 4, you'll only repay if your annual income is over £25,000 a year (before tax and other deductions); and for the Postgraduate Repayment plan, you'll only repay if your annual income is over £21,000 a year (before tax and other deductions).

In terms of how much you'll pay, you'll pay 9% of the amount you earn over the threshold for plans 1, 2 and 4, and 6% of the amount you earn over the threshold for the Postgraduate Loan. So for example, let's say im on plan 2 and I make £3000 a month, since the threshold is £2,274 a month, I would make £726 over the threshold and so I pay 9% of £726, which is £64.25 per month. Interest starts being added to your loan from when you get your first payment. For plan 1, the interest is 1.1%. For plan 2, interest is 4.4% while you're studying and this rate applies until 5th April after you leave or finish your course, after that your interest depends on your income in the current tax year. For plan 4, interest is 1.1%. For the Postgraduate plan, your interest is 4.4%.

In terms of how to repay, your repayments will be taken out of your salary at the same time as tax and National Insurance if you’re an employee. Your payslips will show how much has been deducted. Make sure your employer puts you on the right repayment plan. If you're self employed, you'll pay the same time your taxes are due and HMRC will work out how much you pay from your tax return.

Hopefully that should be everything you need and I would definitely recommend looking at the government websites, https://www.gov.uk/repaying-your-student-loan this one gives you all the information on repaying your loans.

I haven't repaid my loans yet as I don't make over the threshold, so I can't tell you what it's like for me but I assume it's not going to be difficult at all.

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