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Student Loan Stats - Everything You Should Know

7 Facts You Should Know About Your Student Loan

A Good Education Is a Blessing & It Will Unlock the Door to Your Prosperous Future. Quality Education Tends to Be Expensive & Taking a Loan Might Be Your Only Option. Here's What You Need to Know About Student Loans & How to Make Them Work in Your Favour.

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7 things students should know about student loans
In this Article

If you’re a student, then the way your life will change when you graduate from college is probably on your mind. After all, it’s not just about getting a job and starting to work; it’s also about figuring out how to pay off your loans without taking on more debt.

And that means paying back those student loans.

Here are the seven things students should know before taking out loans (or if you’re already struggling with them).

Fact #1: Student Loans Have Strings-Attached

You’re going to have to pay them back, and the payment terms of your student loan will depend on how much debt you take out. Another factor is what type of a tertiary institution1 you attend (public or private).

 Student Loans Have Strings-Attached

Fact #2: Student Loans Can Be Excellent

If you need the cash to pay for university and don’t have a better option than a student loan is right for you. You don’t need to borrow the total cost of tuition, books, and living expenses to attend college. Student loans can be an excellent way to fund your education without having all that money upfront.

Still, it’s essential to know about interest rates and repayment options so that you’re prepared when it’s time to pay back your student loans.

Student Loans Can Be Excellent

Fact #3: You Only Pay Back 9% In Excess Of £27,295

You Have to Pay Back 9% Of What You Earn, in Excess Of £27,295. The repayment of your student loan starts when you start to earn over £27,295. The better the terms of your deal is and the less debt load you take on, the lower repayments will be, which is excellent news if you have a low income.

Student Loans are Not Given With No-Strings-Attached

Fact #4: Debt is written off After 30 Years

If you have a very high income and are on the best possible deal, it will take just over 23 years for you to repay your student loan in full.

That’s not bad at all if that’s what you’re looking for, but bear in mind that your monthly repayments could be more than £400 per month even if you’re on the best possible deal.

 Debt is written off After 30 Years

Fact #5: What The Research Shows About Repayments

Research has shown that most people earning over £27,295 will never pay it all back within 30 years. If you have a meagre income, your monthly repayments could be as high as £50, but the less debt you take on, the higher your overall repayment.

What The Research Shows About Repayments

Fact #6: You Only Need to Pay After Your Course is Complete

If a collection agency is coming after you for unpaid balances and you’re still studying then you should know that loans are paid in arrears2. This means that you don’t need to pay anything until after your university course has finished, then the money is owed by default.

You Only Need to Pay After Your Course is Complete

Fact #7: How Inflation Affects Student Loans

As inflation rises, the Government has to charge ‘above-inflation’ interest rates on student loans. Interest rates are between RPI+0.25% and RPI + 0.35%. Depending on how much you borrowed, the interest will be charged at a rate of RPI+0.25%.

If your income is over £41,000, then the interest will be 0% for up to 30 years or until you’ve repaid the debt in full – whichever comes first.

How Inflation Affects Student Loans

Common Questions

What Are the 3 Types of Student Loans?

How Much Is a Student Loan in the UK?

How Much Can You Get In Student Loans?

How Much Is Student Loan Monthly?

In Conclusion

The doors to a prosperous future are opened by obtaining a good education. Sometimes, for us to attain that we need assistance through student loans. Be that as it may, you don’t need to dread them.

You just need to be aware, prepared, and willing to move forward.

You might want to check out our article on Equity Release!

References

  • www.fastweb.com/financial-aid/articles/seven-things-high-school-students-should-know-about-student-loans
  • www.futurefinance.com/blog/everything-you-need-to-know-about-student-loans/
  • www.moneysavingexpert.com/students/student-loans-tuition-fees-changes/
  • www.forbes.com/sites/maggiemcgrath/2016/01/05/10-things-you-absolutely-need-to-know-about-student-loans/?sh=7b60e5b410d0
  • www.bbc.co.uk/news/newsbeat-51190779

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