Student Finance FAQs

Below you can find a list of frequently asked questions around student finance

Can I pay my student loan off early?

Yes! you can repay your loan in part or in full whenever you want using the online portal and by card, bank transfer or cheque.

But… You might not benefit from making extra repayments because your loan will be written off after a certain amount of time. Before you make an extra repayment, check when your loan will be written off and if it will benefit you.

When do I start paying off my loan?

You’ll only repay your student loan when your income is over the threshold . Your income is the amount you earn (including things like bonuses and overtime) before tax and other deductions. The earliest you will start repaying is the April after you leave your course.

Do I have to fully pay off my loan if I can?

No! You do not have to repay your loan early or ever. If you earn above the threshold the amount you owe will automatically be taken from your salary each time you are paid.

If you never earn above the threshold, you will not be charged a penny, and your debt will still be wiped after 40 years.

What happens if I forget to pay my loan?

If you are employed by a company (not self-employed) then your loan payment will automatically be taken from your pay before you receive it, in the same way tax and national insurance is deducted from your pay.

If you are self-employed HMRC will work out how much you pay from your tax return. You pay at the same time as you pay your tax.

What If I can't afford to pay one month?

Similar to the question before, your student loan repayments are automatically taken out of your pay before you receive it, and you will only be charged 9% of anything you earn above the threshold.

You will only be charged more if you earn more.

How much interest is applied to my loan?

Current students are on plan 5. The interest rate is currently set at 4.3%. This is subject to change and normally does.

However, remember the main points about repayments

• No matter how much debt you have left after 40 years it is wiped
• Your repayments are determined by what you earn now how much you owe
• You only repay 9% of anything you earn over £25,000

What happens if I lose my job? Will my family be asked for money?

If you were to lose your job your income would drop below the threshold and your repayments would stop.

Your family will never be asked for payment in relation to your student loans. If you should be paying off your loan you will be repaying it through your payslip.

Will repaying a student loan affect my ability to get a mortgage?

Student loans don’t affect your credit rating. However, it will affect your monthly income declared for affordability check- which will be slightly lower than if you weren’t paying of your student loan each month.