Once you leave your course, the rate depends on how much you earn and ranges from RPI for those earning £26,575 or less, up to RPI plus 3% for those earning more £47,835. While this means that those with lower incomes take on more debt than those from more affluent families (and will therefore accumulate more interest), the current repayment terms mean that you are unlikely to repay the loan in full before it is released in 30 years. Refunds are made automatically through the tax system. Payments depend on the amount you earn above the threshold during a certain payment period. By payment period, we speak every time you receive your salary. This can be every week, fourteen days, four weeks or one calendar month. Payments are suspended if you earn less than the threshold for that payment period and once you have fully repaid your student loan. It is important to note that if, for example, you are paid monthly and earn above the repayment threshold for that month, perhaps due to a bonus or an overtime, a deduction from your salary will be made. Just be sure to check the box on your tax return that states that you currently have student credit. Many students worry about how their creditworthiness is influenced by much of the debt, but the good news is that your student loan debts don`t show up in your credit information, so it doesn`t affect your score at all (puh!).
Whether you`re just starting college or preparing to finish your studies in the near future, the time will come when you`ll start paying off student loans. No matter how big your student debt is when it comes to state loans (including the normal tuition loan, the alimony loan – everything you actually get from Student Finance) and not loans from a private lender, they will be written off after 30 years (or 25 years if you went to college before 2012).