Jump to accessibility statement Skip to content

Places I've been

The following links below mark the 21 most recent pages you have visited in Sunderland.ac.uk.

Student Loans from the UK Government

This page will hopefully answer your queries regarding how the government's student loans system works.

From your funding being assessed by your national Student Finance office (e.g Student Finance England), to payment of the loans by the Student Loans Company, this section discusses how the payments are made, the interest charged on the loan payments, and how students are expected to repay the loans they have taken out.

Who pays the government's Student Loans?

As with the other elements of funding in the government's undergraduate student finance package (i.e. grants for dependants, Disabled Student Allowance, and the pre-2016 Maintenance Grants), the payments are made by the Student Loans Company (SLC).

Their head office is in Glasgow. Information about the Company can be found on their website - www.slc.co.uk.

At the moment, applications can be made either online through the government's Student Finance website - www.direct.gov.uk/student-finance - or by a paper application form (PN1 for new undergraduate students, and PR1 for continuing students). For students in England, a contact centre authority in Darlington called Student Finance England will assess your application.

The Student Finance contact centre will assess your application to see how much you are entitled to receive - and they will then tell the Student Loans Company how much to pay you. Any payments due to you will be paid into your bank account on a termly basis. Tuition Fee Loans are paid directly to the University.

Contact details for Student Finance England can be found here

How often are the Student Loans paid?

You must apply EACH YEAR for your student finance. The SLC arrange for your Tuition Fees Loan to be paid directly to the University to cover your fees. Then, as with all elements of a student finance package, the Maintenance Loan is first calculated over the full year of study, and then split into THREE termly instalments by the SLC. Postgraduate Loans follow this same termly-instalment model, although of course there is no separate fees loan for postgraduates.

Therefore, the Maintenance Loan payments will be made at the start of each academic term. The Student Loans Company currently splits the payments into instalments that are roughly equal thirds - regardless of the differences in duration of your actual academic terms.

Check the term dates for your own particular programme of study, but for most courses the termly payments would follow the following examples . . . .

For most of our September starts:

Payment 1 = Start of Term 1, in September
Payment 2 = Start of Term 2, after Christmas break, in January
Payment 3 = Start of Term 3, after Easter break, in April/May

For most of our January/February starts:

Payment 1 = Start of your Term 1, in Jan/Feb
Payment 2 = Start of Term 2, after Easter break, in April/May
Payment 3 = Start of Term 3, in September


  • Maintenance Loan payments are made directly into a UK bank account of your choosing - as are any other elements of your student support. The SLC will not make payments by any other method.
  • Tuition Fees Loans are paid directly to the University in order to pay for your tuition.

How much interest is charged on Student Loans?

If you started your course between 1998 and 2012, interest accrues on your student loans as soon as each payment is made. The interest is based on either the Annual Retail Price Index (the rate of inflation) or 1% lower than the base rate, whichever is lowest, each year. For the 2020/21 academic year, the maximum interest rate that can be set for the existing Income Contingent Repayment Loans will be 2.6%. However, the low interest cap will be triggered, and therefore the rate to be charged from 1 September 2020 will be 1.1%.

If you started your course in or after Sept 2012, then the rules changed on the interest side of SLC loans - becoming a tad more complicated. While you are studying, the interest is charged at rate of inflation plus 3%. Then, after you have left your course and your earnings are:

  • below £27,295 per annum - the interest is just at the rate of inflation;
  • between £27,296 and £49,130 per annum - the interest changes to rate of inflation plus up to 3% depending on how high your salary is on that scale;
  • over £49,130 - the interest returns to the rate of inflation plus 3%.



How does the repayment model work?

UK and EU undergraduate students will not have to begin repaying your loan(s) until the April after you have finished or left your course. At this time, the Student Loans Company will calculate the amount of Maintenance Loans and Tuition Fees Loans that you have taken, and this will be your total student loan debt.

The SLC work with HM Revenue & Customs (the UK's Tax Office) to collect repayments. Your repayments will be shown on your pay-slips - unless you are self-employed when the repayments will be taken through the tax self-assessment system.

The amount you repay will be linked to your annual income. For undergraduate loans, each year you will be expected to repay 9% of your income that is over a certain threshold (see below). For postgraduate loans you will also be expected to repay 6% of your income over a different threshold (see below).

For students who started their course between 1998 and 2012, the income threshold is currently £19,895 (this figure is subject to change each year). In other words, you get the first £19,895 of your income per year free from student loan repayment. This also means that, should you receive less than £19,895 in taxable income in a year, you will not be expected to make any student loan repayments for that year.

For students who started their undergraduate course in or after Sept 2012, the income threshold is currently £27,295.  For students repaying postgraduate loans, the threshold is currently £21,000.

Currently therefore, if you started your undergraduate course after Sept 2012 you get the first £27,295 of your income per year free from student loan repayment. This also means that, should you ever receive less than £27,295 in taxable income in a year, you will not be expected to make any student loan repayments for that year

Important Note:


  • If you started your course prior to September 2006, then this repayment model will run until you either pay off your loan(s) or you reach the age of 65.
  • If you started your course between 2006 and 2012, then the repayment model will run for a 25 year period. If there is any balance left to repay after the 25 years expire, then this will be written off by the government.
  • If you started your course in or after Sept 2012, then the repayment model will run for a 30 year period, before any unpaid balance is written off.

The government will also write off any unpaid student loans if you become disabled and as a result can never work again, or if you die. (This way, your student loan debt should never be transferred to another person).


Student Loans - Facts and Myths

Martin Lewis' MoneySavingExpert website has put together some excellent information on Student Loans that is filled with examples (and jargon-free!).

It gives you some more information on topics such as: how student loans work, how they are treated for mortgage purposes, and how much you are actually likely to repay in the 30-year repayment term, among others.

See the webpage here - 

His Student Finance repayment calculator is here - 


close tray menu