This seems to be a major topic of discussion in many educational circles, not so much in the UK I might add, but I notice this as being a significant industry in the USA.
Student loans here in the UK are generally obtainable if a student is eligible for a degree of some kind from a recognised higher education, (HE), educational provider, such as a University or College.
Mostly student loans, and of course all their associated interest rates and consolidation, are provided by the main banks in the country. A student once having secured a University place is then almost without exception entitled to a loan.
This was not always the case in UK, it used to be the case that a student would be entitled to an educational grant, paid by one’s local educational authority ( LEA, which is county based), whereby effectively higher education was free, the grant was means tested based on a student’s family income etc.
However, education is no longer free, and hasn’t been for some time, and student loans are the norm for people in higher education, and up for grabs for any HE student.
Of course this has opened the market up to other companies providing loans for HE students including the large American student loan company Sallie Mae with quoted rates of 9.3% APR. Naturally this market is probably likely to become fierce as essentially the company/bank is basically looking at investing in a prospect for life!
Bank student bank loans are actually very flexible with a no payment necessary policy until the graduate earns a particular sum per year, and then the required amount is minimal, and on a sliding scale. In fact I personally have heard enrolment officers stating to students, that students could actually view the loan repayments as a very small tax for life, hardly a noticeable deduction from the monthly pay check.
If a student is racking up 30 grand worth of debt over three or 4 years you can clearly see why viewing this as an educational tax is probably about correct.
Maybe you have a big student loan, have you paid this off, are you still in debt, how do you cope with your debt, is it a problem in working life?
I’d love to hear about that.
Hmm. I’m from Scotland so the rules have changed so much i am not sure what’s what. However – i was means tested on my own merit as I was financialy independent from my parents for a certain period of time. That allowed my fees to be paid by the government or the university. living and expenses for the course had to be met by myself and that necessitated loans. My loan repayment % is at 7% or so at the moment which is more than the 3% I had started with.
Anything over £833 a month is liable for loan deduction. I find it manageable but will still be paying the remainder for some time to come. I don’t see much point in paying it off faster at this time because i have other debts with higher rates of interest. So I am dealing with them first and will tackle the student loan afterwards.
It doesn’t affect my working life, apart from when the SLC (student loan company) is late in removing money from my PAYE – I move jobs a lot and they are slow to catch up, meaning paying it off is slower.
I wouldn’t say the amount is “hardly noticeable” though, it is a fair chunk, especially when cost of living is getting higher.
Of course I’d love to be debt free but as loans go, it’s not the worst you could have!
Jo, sounds like you manage it very well… good skills.
That jump in rate from 3 to 7% when did that happen? That sounds naughty.
It happened a few years ago. Just got a letter saying the interest rates had changed to reflect something or other – I checked it out and they were within their rights so hey ho!
I am a current student receiving said student loan from the student loans company, and first of all can i just say how ridiculously disorganised the company is. I received my student loan only last weekend (only one month after my studies began) and the company has given me much less than i should be getting from them. I would normally qualify for a maintenance grant which is an extra non-repayable amount that is given due to household income which in my case adds up to close to another £3000 a year, this keeps me from needing to work whilst at uni allowing me to concentrate on my studies, which is very welcome i’m sure you can imagine. This year my parents have separated so i could receive more money from the loan company as part of my loan but it has taken me the best part of three months to try to get this fact into the thick skulls of said company. Only late last week did i manage to get out of them what sort of evidence i need to provide them to show that my parents are in fact separated and that my mother is no longer contributing to my household income! I can understand a company being reluctant to give money but this is a loan company for gods sake!
As far as debt goes, when i finish my three year course i will be in near enough £20,000 of it which is at least mildly worrying, and after the three years i plan to continue on and do a PGCE and go into teaching after a few years of which i will given the opportunity and (if my understanding is correct) do another year at uni to come out with a masters degree, god knows how much more debt that will collect, i daren’t look! i’m just hoping i’ll get some of it written off cos i want to teach!
Yeah sure sounds like a lot of debt, so good for you keeping a straight head about it all.
What company do you use, where does your loan come from?
just the student loans company as far as i know … but i think most of my dealings go through my LEA so it might actually be from them. I’m not quite sure. :s
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What does this bullshit have to do with student loans? – or is it a cheap spam shot?
Normally everybody looks at the loan with the eye of suspicion as according to them they have to pay double than what they take. But they looks at student loan with a different view point as same is used to make the future of student, and as he has not to repay till he completely becomes self reliant in case of money. I like student loan.
Hey this can encourage the student loan and more of them can get the quality education with the help of same.