How bad are student loans in the UK?
UK average
The forecast average debt among the cohort of borrowers who started their course in 2022/23 is £45,600 when they complete their course. Forecast debt is expected to be lower for those starting in the reformed system from 2023/24 at £42,900.
If you don't make repayments, SLC have the right to take legal action to recover your debt. This means SLC can get a court order to make you repay the total debt plus interest and penalties in a single payment.
It's worth it if you're not wealthy, as it means you don't have to decimate your bank account in order to study. You can of course choose to repay early. The point is that you get the degree, then you get a much higher-paying job and pay the debt off in 3-4 years, then you're set for life.
Repaying the Loan
As in the US, UK student loans have to be repaid. However, you only make payments on your student loan if your income is over £21,000 (approximately $36,000) per year and after that amount, your loan payments are capped at 9% of your income per year.
Globally, student loan debt in the U.S. is second only to the United Kingdom, according to a 2022 Lending Tree report. Before the pandemic, Samuelian worked full time at a pharmaceutical company and made regular repayments. But she still had to pick up a side job waitressing for additional income to pay her bills.
If you're a student from England or Wales, your Postgraduate Loan will be written off 30 years after the April you were first due to repay.
According to 2023 statistics, an undergraduate student is left with an average debt of £45,000 after studying. For postgraduates, the average student loan debt is around the £24,000 mark.
You'll need to repay at least some of your Tuition Fee loan for the year that you suspend or leave your course. You'll need to pay back: 25% of the loan for the year if you suspend or leave in term 1. 50% of the loan for the year if you suspend or leave in term 2.
If you're declared permanently unfit for work or permanently disabled, the Student Loan Company will write off your loan. It'll also be written off if you die.
What percentage of people pay back student loan UK?
Full-time UK undergraduate students starting in the academic year 2022-23 are predicted to borrow an average of £42,100 over their time at university. This is typically over a 3-year period. Of these, more than a quarter (27%) are expected to repay their loan in full, rising to 61% for the 2023-24 cohort.
If you leave the UK for more than 3 months. You must update your employment details to let the Student Loans Company ( SLC ) know you have left the UK. You will need to continue to repay your loan unless you provide evidence that your income is below the threshold.
| Total Student Loan Debt | Repayment Period |
|---|---|
| $10,000-$20,000 | 15 years |
| $20,000-$40,000 | 20 years |
| $40,000-$60,000 | 25 years |
| Greater than $60,000 | 30 years |
If you are an international non-EU student, it's unlikely you will be able to get a student loan from the UK Government. Some universities will create their own student loan schemes for talented students from low-income backgrounds, including non-EU students.
Leaving the UK
If you received a UK student loan and you leave the UK for more than three months after finishing your course, you must inform the Student Loans Company (SLC). Their contact details and an online form can be found on GOV.UK. The SLC will then take over the collection of the repayments.
Which countries have no student debt? In Finland, Germany, Iceland, Scotland and Sweden, students may be eligible for free tuition. However, in some cases, you may need to be a citizen of that country in order to qualify for free tuition.
Black families borrow student loans at higher rates than other races — and they owe more. 30.2% of Black families hold student loan debt, versus 20.0% of white and 14.3% of Hispanic families.
private schools, the cost of living and the number of students. The state with the highest student loan debt is California and the state with the lowest student loan debt is Wyoming. State student loan debt runs from $152.82 billion to 1.78 billion in Q4 in 2022.
It's the result of a decades-long explosion in borrowing coupled with soaring education costs. The Federal Reserve data shows people under the age of 30 are more likely to have student loan debt compared with older adults – underscoring the crippling burden on another generation of Americans.
✅ Plan 1 student loans in England, Wales, Northern Ireland, and Scotland are written off when the borrower reaches 65 or after 30 years, whichever comes first. (Source: Team Research) ✅ Plan 2 student loans in England and Wales, and postgraduate loans in England and Wales, are written off after 30 years.
What happens if you don't pay off student loans in 25 years?
Any borrower with ED-held loans that have accumulated time in repayment of at least 20 or 25 years will see automatic forgiveness, even if the loans are not currently on an IDR plan. Borrowers with FFELP loans held by commercial lenders or Perkins loans not held by ED can benefit if they consolidate into Direct Loans.
If you have federal student loans and are making payments under an income-driven repayment (IDR) plan, you may be able to have your loans forgiven after 20 years.
The universities of Winchester, Surrey, and Queen Mary have added themselves to the list of higher education institutions claiming financial deficits leading to job losses and course closures.
Do student loans go away after 7 years? While negative information about your student loans may disappear from your credit reports after seven years, the student loans will remain on your credit reports — and in your life — until you pay them off.
The Student Loans Company (SLC) is an executive non-departmental public body company in the United Kingdom that provides student loans. It is owned by the UK Government's Department for Education (85%), the Scottish Government (5%), the Welsh Government (5%) and the Northern Ireland Executive (5%).
