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Repayments
You do not pay tuition fees upfront. Repayments on the Student Loans will only start when you have graduated and are earning a certain income.
- Key points
- You DO NOT pay tuition fees upfront.
- You pay back your fees when you earn more than £21,000 - unless you are from Northern Ireland where the figure is £15,795.
- The amount will automatically be taken out of your salary.
- Student loans do not go on credit files.
- Repayment for students from England and Wales is over 30 years.
- After 30 years, even if you haven’t finished paying the loan, it is wiped off.
- If you are from Northern Ireland your outstanding balance will be written off after 25 years.
- You do not have to pay back bursaries or government grants.
How loan repayments are expected to work for students from England and Wales
- You will not start to make repayments until you earn over £21,000 a year.
- If your income falls below £21,000, your repayments stop - for example if you take a career break or are unemployed - until you start earning £21,000 again.
- You repay 9% of your income above £21,000. The amount you repay depends on how much you earn, for example, if your salary was £25,000, the 9% would only apply to £4,000, meaning you would repay £30 a month.
- All your student loans are added together and a single repayment will be deducted from your salary, normally through the tax system.
- Any outstanding balance is written off after 30 years.
Rates of interest
- Interest on your loan will be applied at the rate of inflation plus 3% while you are studying and up until the April after you leave university.
- From the April after you leave your course, interest will be applied at the rate of inflation if you are earning below £21,000; the rate of inflation and up to + 3% on a gradual scale if you earn between £21,000 and £41,000; and the rate of inflation + 3% if you earn over £41,000.
The table below shows some salaries and typical repayment amounts.
| Salary | Amount of salary from which 9% will be deducted | Monthly repayment |
|---|---|---|
| £25,000 | £4,000 | £30.00 |
| £30,000 | £9,000 | £67.50 |
| £35,000 | £14,000 | £105.00 |
| £40,000 | £19,000 | £142.50 |
| £45,000 | £24,000 | £180.00 |
| £50,000 | £29,000 | £217.50 |
| £55,000 | £34,000 | £255.00 |
| £60,000 | £39,000 | £292.50 |
Further details on the repayment of student loans can be found on the SLC website.
How loan repayments are expected to work for students from Northern Ireland
- You will not start to make repayments until you earn over £15,795 a year (this amount will increase in line with inflation each year).
- You repay 9% of you income above £15,795. The amount you repay depends on how much you earn, for example, if your salary was £25,000, you can expect to repay around £9 per month.
- Any outstanding loan balance is written off after 25 years.
Rates of Interest
- Interest is applied to the loan annually at the rate of inflation (using the Retail Prices Index) which through time maintains, in real terms, the loan at the same value as at the time it was borrowed.
Further details on the repayment of student loans can be found on the SLC website.
This article was published on Oct 20, 2011