Repaying undergraduate and postgraduate student loans

• How much will I repay on my loan?
• When do I start repayments on undergraduate loans?
• When do I start repayments on postgraduate loans?
• How are loan repayments taken?
• What about interest?

If you’re thinking about applying for student finance to help pay for uni or college, it’s important you understand how you’ll repay any money you borrow.

You’ll apply for student finance from Student Finance England (SFE) when you’re at uni or college. But when the time comes to repay, you’ll make your repayments to the Student Loans Company (SLC).

The important thing to remember is that the amount you’ll repay will be based on how much you earn, not how much you borrowed.

If you took an undergraduate loan, you’ll repay 9% of your income above the repayment threshold – earn less than the threshold and you won’t repay anything.

If you took a postgraduate loan, you’ll repay 6% of your income over the threshold. 

Find out what it means for you (external link) if you took an undergraduate and a postgraduate loan.

The threshold is different depending on which repayment plan you’re on. Find out about the different repayments plans on Gov.uk.

If your income changes the amount you repay will change too.

If you stop working or start to earn below the repayment threshold, you’ll repay nothing at all until you earn over the threshold again.

You’ll make a repayment if you go over the weekly or monthly threshold at any point during the year, for example if you get paid a bonus or work overtime. 

You can request a refund (external link) at the end of the tax year if your total income was below the repayment threshold.

Studying a full-time course

You’ll normally be due to start repaying the April after you finish or leave your course and your income is over the repayment threshold. 

Studying a part-time course

You’ll normally be due to start repaying when you’re earning over the repayment threshold the April four years after the start of your course, or the April after you finish or leave your course, whichever comes first.

You’ll be due to start making repayments:

• the April after you finish or leave your course, or
• the April four years after the start of your course if you’re on a course longer than four years

Any loan remaining 30 years after you’re due to start making repayments will be cancelled.

You might be asked to make repayments before you’re earning over the threshold, but only if you’ve been overpaid and SFE can’t adjust your loan payments to correct it.

When will loans be cancelled?

Any outstanding loan balance will be cancelled (external link) after a certain number of years. This differs depending on which repayment plan you’re on.

How you’ll repay depends on what you choose to do after your course.

If you start working

Your employer will automatically take repayments from your salary at the same time as tax and National Insurance.

If you’re self employed

You’ll make repayments at the same time you pay tax through Self Assessment.

If you move overseas

You’ll repay directly to SLC, instead of having it taken automatically from your salary.

To reflect differences in the cost of living, the repayment threshold could be different from the UK threshold. Before you leave the UK, you need to tell SLC (external link).

Interest is charged from the day SFE makes your first payment to you or your uni or college, until your loan is repaid in full or cancelled.

The interest rate is based on the UK Retail Price Index (RPI), which measures changes to the cost of living in the UK.

In some instances, the interest rate may be reduced on a temporary basis to make sure you’re not being charged a higher rate than the average charged by commercial UK banks.

The amount of interest you’re charged can differ depending on which repayment plan you’re on.

Find out more about interest on Gov.uk.