I was talking to my dad the other day – apparently the student loan company sent him a letter out of the blue asking for proof of his income for the year 2006-2007. Now, it turns out that if you have a child at university asking for a loan, they want you to estimate your income at the start of every year, and prove it at the end of every year.
When I left university almost two years ago, my dad never got round to sending them proof and forgot all about it.
Months passed. The seasons changed. Eventually, in some dusty corner of an office somewhere, someone got round to sending out another letter demanding proof of income or bad things would happen. Cue lots of searching round my parent’s house for old payslips, tax returns and the like to appease The Powers That Be who Forgot About It For Almost Two Years.
A couple of weeks later the student loan company sent me a letter – now, bear in mind I left university in 2007 and have been repaying my loan along with the extortionate interest ever since.
The letter says:
“We have reviewed your entitlement to student finance because…we have received advice that your circumstances have changed… You are entitled to receive an increased amount of tuition fee loan. If you would like to request the increased amount, please complete the enclosed Tuition Fee Loan Request Form…”
Now as far as I’m aware, people starting university when I did simply weren’t entitled to tuition fee loans. My parents paid my tuition fee up front – so it’s paid. Dealt with. Why are the student loan company offering me an extra £407 loan along with a £793 grant to cover the rest? Actually, I’m sure my parents would be happy to receive the grant – should they have got this three years ago instead of having to pay my £1200 tuition fee?
Interest
When I was at school talking about going to university, I remember teachers telling me that it’s okay, loans are fantastic, you don’t start paying interest on them until you leave university.
What a load of bollocks. You pay interest on your loan from the day you take it out.
I dug out my “annual statement” from September 2007 – just after I’d left university, so let’s take a look at my interest payments.
Sept 2006 – I owed £9834.97 – Interest payment = £19.86/month
Jan 2007 – I owed £11945.32 – Interest payment = £24.34/month
Apr 2007 – I owed £13856.12 – Interest payment = £28.45/month
Thanks to all that interest mounting up each month, when I left university I owed the princely sum of £14138.82
When I started working, my automatic repayments didn’t cover the interest.
Online Service
The student loan service, unlike other financial institutions like, for example, banks, only send you a statement once a year. This means, (to quote the direct.gov website):
No information regarding repayments, balances and collection will be passed between the Student Loans Company and HMRC, other than the repayment information transfers at the end of the tax year when HMRC tell the Student Loans Company how much you have paid.
This means that there may be times when you wish to contact the Student Loans Company or HMRC about your balance, but they can’t provide you with this information.
You can however try to use the student loan company’s online service to ‘estimate’ how much you owe. Unfortunately, my student ID number isn’t enough to log me in. It acknowledges this is my first time using the service and asks me to set a new password. Only it wants an old password…which I’m reasonably sure I never had in the first place.
I feel like I was sold this product when I was too young to really understand how crap it was, and although I don’t mind paying it – it’s a loan after all – I resent the high interest payments that make it impossible to pay off even though I have a job. I also think that I wouldn’t take this sort of awful service from a bank – statements once a year? The government admitting that they don’t really know how much anyone owes?
What a massive shambles! I’d love to hear your rants about student loans so feel free to comment below. Or if you’re from the student loan company could you let me know when the whole system is going to collapse? It’s just a matter of time, right?
Website Templates
Don’t get me started on the student loans company. The most useless government department I’ve had the misfortune to deal with. Even worse than the tax office.
In a previous job my student loan and National Insurance was not paid (despite it being taken out of my wages by my employer who didn’t declare the payments) The emphasis was on me to prove I HAD paid my loan money not on the previous company to prove they hadn’t taken the money. Due to a lack of payslips ever being given out I can only prove a portion of my payments and so have lost a lot of money. I have phoned the SAAS at least 10 times over the year asking for a statement o I can check it is finally correct but they don’t seem to be able/willing to produce one and my online statement is incorrect.
Seems the SAAS is purely there to get money from anyone and does not seem to care from where.
I have gone through a horrible process to try to reclaim this money and with no support from the SAAS. The National Insurance is now sorted which is at least one good thing.
Oh don’t get me started on them either
They never know exactly how much you owe them; they never send out annual statements on time (nor annually!); a guy I know has worked for about 5 years and has never paid any back even though the SLC know he’s working.
Those on the pre-PAYE days have even more of a laugh as they get to send in a cheque once a year – can you see the SLC chasing up non-payers?!
Plus I remember when at uni the number of people that didn’t get their payments on time. I certainly don’t have any confidence that the money that leaves my via PAYE actually ends up at the SLC without some of it getting lost in the system.
With regards to the interest part – sounds like you were given duff information to me. My understanding on going to uni in 1999 was that you were charged interest immediately but that interest would only be pegged at inflation for the duration of the loan – so you only pay back the ‘real’ value which fair to me.
I experienced the “you’ll never pay it back on this wage” scenario and it took me 4 years to get onto a wage that will see me pay it back on the minimum payments. But I took that as a positive thing – it means that the repayment levels aren’t prohibitive or likely to induce hardship. I wouldn’t shout too loudly about it as it may mean they reduce the thresholds back to their old levels to mean we all pay more.
This all said, I’m assuming that the loan deal you got was comparable to mine – it may be that you’re not on the ‘inflation only’ deal.
Oh – and I don’t regard the loan as a burden really on account of it being ‘inflation only’ – it’s more of an inconvenience. However that doesn’t mean to say that a future government won’t call in the debts/increase the interest with legislation – but I would hope that wouldn’t happen as it would affect such a large number of people it would be political suicide.
oh my god, i totally agree they areuseless, I’m applying for help with fees for the Open University, but the reference number they have given me isn’t long enough, so I tried logging into the Studen loan comps site and got the same msg, to reset my password… I DON’T HAVE A PREVIOUS PASSWORD, just totally useless, also the details they had to contact me were for my address from 5 years ago, even though I have been making payments up until last year when my income reduced – why doesn’t it go on your national insurance number like everything else, it’d be a lot easier!
They are completely shit. Just tried to pay using an Austrian credit card. This is attached to an Austrian zip code. I happen to live in Austria. But it seems that thez don’t like anything other than British postcodes, so I’ve been scuppered. I guess I will soon receive another letter explaining how they will come to repossess my legs.
Why don’t they set the threshold for which repayments start at a level whereby you are at very least paying back the whole interest, if not some of the loan too?
Incompetent diots profiteering from poor students. I’m trying to get through to them on the phone and its pretty much impossible to get through.
[...] want to subscribe to the RSS feed for updates on this topic.I wrote a post a while ago about how crap the student loan company is. It seems I’m not the only person with a bad impression – let’s take a look at [...]
This post is really nice. Few months back I first come to visit here and i was too impressed by the material provided here. now i am regular visiter her.good work.