Before we proceed to speaking about financial obligation more generally speaking, it is well well well worth very first clarifying that there is an impact between education loan debt (which means that your upkeep loan and tuition charge loan combined) as well as other kinds of financial obligation.
Whilst it is just natural that you would have the weight of graduating with a sizable lump of financial obligation over your face, usually the therapy of knowing you’ve got the financial obligation may be the part that is hardest.
This year, one in two of you told us you didn’t understand your student loan agreement in our National Student Money Survey. For the sake of your mental health, we think it’s worth clarifying a few things about why these loans are different whilst we would never describe student loans as a ‘good deal’ and we certainly don’t agree with the interest rates currently charged on them.
4 perks about education loan financial obligation which makes it distinctive from other financial obligation:
You only repay once you are making sufficient
Unlike any kind of types of debt, education loan financial obligation takes into account just how much you earn and bases repayments about this figure.
An element of the education loan contract is the fact that graduates don’t need to repay a cent of the loan until they truly are earning ?25,725 a 12 months and over (in the event that you began uni before 2012 or learning in Scotland or Northern Ireland, you begin repaying once you make ?18,935). Many graduate jobs offer salaries of not as much as ?25k, meaning you will possibly not start having to pay your loan down until many years after uni. Continue reading