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Student Loan Debt Collectors – Do I Have to Pay?

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Scott
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Scott Nelson

Managing Director

MoneyNerd’s founder, Scott Nelson, has a decade of financial industry experience, including 6 years in FCA regulated loan and credit card companies. Troubled by a lack of conscience in the industry, he founded MoneyNerd to give genuine advice to those in debt and struggling financially.

Learn more about Scott
&
Janine
Janine Marsh Profile Picture

Janine Marsh

Financial Expert

Janine Marsh is an award-winning presenter and a valuable member of the MoneyNerd team. With a wealth of experience as a financial expert, she's been featured on BBC Radio 4, BBC Local Radio, and BBC Five Live, and is a regular on Co-op Radio.

Learn more about Janine
· Feb 6th, 2024
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For free & impartial money advice you can visit MoneyHelper. We work with The Debt Advice Service who provide information about your options. This isn’t a full fact-find, some debt solutions may not be suitable in all circumstances, ongoing fees might apply & your credit rating may be affected.

Are you puzzled by a letter from student finance debt collectors? It might be scary, but we’re here to help.

Each month, over 170,000 people come to our website for advice on debt issues. You’re not on your own.

This article will help you understand:

  •  Where this debt might have come from.
  •  How to check if you really need to pay.
  •  What happens if you can’t afford to pay.
  •  Ways to stop the debt collectors being so pushy.
  •  How you might be able to clear some of this debt.

Research shows that 64% of UK adults find interactions with current debt collectors stressful1. We understand how you feel.

So, don’t worry. We’ll help you learn more about student finance debt collectors and what you can do.

Could you legally write off some debt?

There are several debt solutions in the UK, choosing the right one for you could write off some of your unaffordable debt, but the wrong one may be expensive and drawn out.

Answer below to get started.

How much debt do you have?

This isn’t a full fact find. MoneyNerd doesn’t give advice. We work with The Debt Advice Service who provide information about your options.

What are Student Loans?

Student loans are loans that are given to students of a university in order to cover the fees of various aspects of student life. 

Student loans can cover the costs of things like lectures, tuition fees, seminars, any equipment you may need, transportation fees, and they can help you with living costs.

You usually receive three every academic year, roughly working out as one at the start of each term. 

What is a Student Loan Debt?

Your Student Loan Debt is, as the name might suggest, the debt that you owe for your student loans, and studies suggest that this debt is increasing.

In 2022, the SLD in England was at just over £45,000. In 2020, it was just over £40,0002. However, the debt for each country in the UK is vastly different as well.

As you can see, the debt in England is almost four times as much as the student loan debt in Scotland, and regardless of the amount of debt that you may have you will be expected to pay it back. However, this is only if you meet certain requirements.

Once you leave university, unless you take out a postgraduate loan to complete a master’s degree, you will start to pay back these loans once you earn at least or over £27,295 per year. This works out at roughly:

  • £2,274 per month
  • £324.85 per week (7 days) or £454.8 per week (5 days) 

And there are higher brackets too.3

However, many people never pay back their student loans. This is due to not earning enough, or the time to pay it back elapses because when it comes to student loans if they are not paid back within a certain time, you will not have to pay them.

So, what is this magic number?

» TAKE ACTION NOW: Fill out the short debt form

How long after Graduation do Student Loans stop being seen as Debt?

Unfortunately, it’s 30 years. When it comes to student loans, it’s a bit longer than six years.

As I’ve said, you’ve got to meet certain requirements to pay off your student loan debt. That is of course unless you never earn over the required amount, or you reach the expiry date. 

It’s for this reason that some people who are older and haven’t got a degree but want one decides to get a degree at this moment. It’s because they know they’ll likely never have to pay it off. 

If you want to know more about debt write off, then you might want to check out some of our other articles.

How a debt solution could help

Some debt solutions can:

  1. Stop nasty calls from creditors
  2. Freeze interest and charges
  3. Reduce your monthly payments

A few debt solutions can even result in writing off some of your debt.

Here’s an example:


Situation

Monthly income £2,504
Monthly expenses £2,345
Total debt £32,049

Monthly debt repayments

Before £587
After £158

£429 reduction in monthly payments

If you want to learn what debt solutions are available to you, click the button below to get started.

Get Started

Can Student Loans go to collections?

If you refuse to pay your student loan debt, then there is a possibility that the debt collector in question could send someone to your house if this happens. 

However, whilst this might happen, they cannot be bailiffs, nor can they claim to be.

If you’re earning well beyond the required amount, and you’re still refusing to pay, or simply ignoring them, then they may well want to enforce the debt a little bit harder. 

However, once again to really do this, they have to take you to court first. From here, they can issue a county court judgement against you. Send bailiffs to recover goods in equal value, or apply for an attachment, earnings, or charging order. 

But as I’ve said, this can only happen if you are taken to court first.

Ignoring your Student Loan Debt Collector

I always recommend responding to debt collectors – even just to question the debt’s validity. Remember, you have the right to request proof of the debt. They have to prove it or they can’t charge you.

So, what happens if you earn over the specified amount and you choose to ignore your student loan debt collector?

Whilst student loans might not be as heavily enforced as other loans like mortgages, ignoring your student loan debt collectors’ advances can have serious consequences, and just because they’re not as heavily enforced, doesn’t mean that they’ll give up trying to get the money from you.

After all, if you owe the money, and can pay the money, then you will be expected to. 

But if you don’t pay, and you ignore the advances of your student loan debt collector, what can they do to get the money from you?

Thousands have already tackled their debt

Every day our partners, The Debt Advice Service, help people find out whether they can lower their repayments and finally tackle or write off some of their debt.

Natasha

I’d recommend this firm to anyone struggling with debt – my mind has been put to rest, all is getting sorted.

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Student Loan Debt Collectors – Do I Have to Pay?

The answer isn’t so much “Do I?”, but more “Will I?”.

The chances of being in student loan debt once you’ve finished university are high. But paying it off depends on what happens afterwards.

If you don’t earn enough or the time for repayment expires then, no, you will not have to pay. 

But should you earn more than the required amount, you will be expected to pay this debt, and not paying it could lead to further costs down the line. If you ignore your Student Loan Debt Collector in the UK, there are consequences that you could face, and it’s best to avoid these unnecessary hits to your personal finance.

Thanks for reading this article. If this helped, be sure to check out some of our others!

Could you legally write off some debt?

Answer below to get started.

How much debt do you have?

This isn’t a full fact find, MoneyNerd doesn’t give advice. We work with The Debt Advice Service who provide information about your options.

References

  1. Indebted Debt Collection Survey
  2. Statista UK Student Loan Debt 2023
  3. Money Saving Expert – Student Loans
The authors
Scott Nelson Profile Picture
Author
MoneyNerd’s founder, Scott Nelson, has a decade of financial industry experience, including 6 years in FCA regulated loan and credit card companies. Troubled by a lack of conscience in the industry, he founded MoneyNerd to give genuine advice to those in debt and struggling financially.
Janine Marsh Profile Picture
Debt Expert
Janine Marsh is an award-winning presenter and a valuable member of the MoneyNerd team. With a wealth of experience as a financial expert, she's been featured on BBC Radio 4, BBC Local Radio, and BBC Five Live, and is a regular on Co-op Radio.