Good to know
- Both the Tuition Fee Loan and the Maintenance Loan need to be paid back
- Repayment only begins once your son or daughter has left university, and is earning over a certain threshold
Your son or daughter does not have to start repayments to the Student Loans Company, which lends your son or daughter the money on behalf of the government, until:
- the April after they have left university
- they are in employment
- and are earning over £25,000 for English and Welsh students or £18,330 for Northern Irish and Scottish students (this figure is for 2018–19; it normally increases every year with inflation)
How does repayment work?
You are not responsible for your son or daughter's loan. Repayments are usually taken straight from your son or daughter's salary, which means they won't need to worry about working out how much they owe or when payments are due.
The amount they pay back each month is linked to how much they're earning, not how much they owe in total. Repayments are currently calculated at 9% of the amount they earn over the threshold.
For example, a student from England/Wales earning £33,951 per year (the average starting salary for Imperial graduates) pays 9% of £8,951, while a Scottish/Northern Irish student earning the same amount pays 9% of £15,621.
The government writes off any unpaid debt after 30 years for English and Welsh students (25 years for Northern Irish students; 35 years for Scottish students).
Both loans attract an interest rate, even while your son or daughter is studying.
During study until the April after they leave university, the rate for English and Welsh students is that year's inflation rate + 3%. After university, the interest rate they will be charged is based on their income.
For students from Scotland and Northern Ireland, the interest rate they will be charged is set by the Department for Business, Innovation and Skills (BIS). It is normally based on the Retail Price Index. Interest rates are updated annually.
For more information about repayment of loans, visit the Student Loans Company's website.