Student Loan repayments don’t stop if you leave the UK
Moving abroad after uni whether for a few months or for good doesn’t mean you can forget about your Student Loan!
Living or working overseas may change your income threshold, so you’ll still need to stay in touch with the Student Finance office and keep up with repayments. Our guide to repaying your Student Loan from abroad explains what to do.
You need to stay in touch with Student Finance
Like a particularly nosy relative, your Student Finance office wants to know what’s happening with you. You’ll need to tell them about obvious changes like your phone number, address, household income and bank account, as well as less obvious life events like getting married, moving abroad or working for yourself.
Not updating your details may mean missing out on funding at uni or, if you’re overpaid, having to pay back the extra. Not replying to emails or passing on info after uni could mean being charged higher interest rates or even penalty fees.
Repaying early could be more expensive
You can choose to clear your student debt or make higher repayments at any time. This might be tempting if you want to be free of your loan ASAP, but it’s usually only worth it for higher earners (i.e. those with a starting salary above ?30,000).
For everyone else, it could mean paying back more than if you’d let the loan run its natural course. Plus, once you funnel extra money towards your loan, you can’t get it back later on (i.e. if you’re skint or want to spend it on something else). Think it over carefully and only pay up when you can afford to.
Warning: The terms aren’t set in stone
Shockingly, the Student Loan’s terms can be amended even after you’ve signed the contract. Interest rates are the obvious example, but the earnings threshold and even loan wipeout can be tweaked or dropped at will.
The last time this happened, the government backtracked on a promise to increase the salary threshold to take the pressure off repayments, and only reverted to the original agreement after a lot of noise from Save the Student and other campaigners.
It’s impossible to know exactly how political gestures like this will play out. In the meantime, we’ll always report what’s going on and keep this guide updated.
You may have to repay grants if you drop out
Each year, some students will find uni just isn’t the right call, or that money or personal issues make it impossible to carry on. If that’s you, don’t throw in the towel until you’ve talked it over with a uni advisor or the Student Finance team.
In particular, be clear about if and how you have to give back any non-repayable funds, such as grants and bursaries. Dropping out may also impact your chances of getting Student Finance again in the future.
Another reason you might have to repay free funding is if you bodge the numbers on your application (or don’t update your details) and end up getting overpaid keep an eye on it!
5 ways to reduce student debt
- Find hidden funding Hundreds miss out on free money each year because they don’t know it’s there or assume they’re not eligible yet almost all students have a shot at extra funding.
- Avoid unnecessary borrowing When you can afford to pay it back, borrowing is perfectly safe. But it’s very easy to slip up, so don’t touch credit cards, private loans or even a 0% overdraft without a plan. If you’re using credit to cope with hardship or cover up other debts, read this first.