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How and when you repay your student loan (courses starting before 1998)
If your course began before 1998, your student loan repayments will be made in monthly instalments. You can apply to defer your repayments if you earn under a certain amount.
Repaying your student loan
If you took out a student loan for a university or college course that began before September 1998, you will repay it in monthly instalments.
These repayments will usually be collected from your bank account by direct debit and paid to the Student Loans Company.
If your course began in or after September 1998, you'll make your student loan repayments in a different way: see 'Repaying student loans (courses starting from 1998)' for details.
How much you repay
How much you still owe will be outlined on your annual statement, sent to you by the Student Loans Company.
If you have four or fewer loans for courses beginning before 1998, you will repay your loan in 60 monthly instalments. If you had five or more loans, you repay in 84 monthly instalments. Monthly repayments are calculated on the basis of the total amount borrowed, adjusted according to the relevant interest rate (based on the rate of inflation), and divided by the total number of months over which you’re making repayments.
Interest is calculated daily. It's applied to your account from the point when the loan is paid to you, up until it's been repaid in full.
For student loans taken out for courses starting before 1998, the interest rate for each academic year is based on the previous March’s Retail Prices Index (RPI) figure.
Interest from September 2008 to August 2009
For the academic year covering 1 September 2008 to 31 August 2009, the interest rate is 3.8 per cent.
Interest from September 2009 to August 2010
For the academic year covering 1 September 2009 to August 2010, the interest rate will change to -0.4 per cent.
As usual, you’ll start to see the change in interest rate reflected in your monthly repayments from the start of the academic year. Check your annual statement from the Student Loans Company to find out exactly how much you’ll need to repay over the coming year.
Deferring repayments
If you earn under a certain amount and wish to delay repaying your student loan, you can apply to defer your repayments.
Making your first repayment
Repayments begin in the April after you graduate or stop attending your course. For example, if you graduated in June 2001 you would have started making repayments in April 2002.
Two months before you are due to start repaying your loan, the Student Loans Company will send you a letter stating your balance, and confirming your bank details and monthly direct debit amount.
If your bank details have changed, you should immediately complete and return a new direct debit instruction to the Student Loans Company. If you do not defer repayment, you will then receive a schedule showing the monthly repayments you will make between April and August.
Each September you will get a schedule of the monthly repayments you'll need to make up to the following August.
If you have trouble repaying
If you have trouble making your monthly repayments but your monthly income is too high to allow you to defer them, contact the Student Loans Company.
See 'If you have trouble repaying your student loan' for more details.
If your circumstances change
If there's a change to your contact details, income or marital status, let the Student Loans Company know so your account details are kept up to date.
Increasing your repayments to pay off your loan early
If you want to repay your loan early - either by increasing your monthly repayments, or by making a payment before your repayments are due to begin - there are a number of ways to do so:
- make a payment by debit or credit card, either online or by contacting the Student Loans Company over the phone (the minimum repayment amount by card is £5, and a 1.5 per cent surcharge is added to credit card repayments)
- contact the Student Loans Company to amend your existing direct debit
- set up a standing order with your bank, using the student finance standing order form
- send a cheque or postal order to the Student Loans Company, quoting your student loan account number
- send a cash repayment (this must be done by registered post)
If you have more than one type of student loan
The way you repay your student loan is different depending on whether your course started before or after 1998.
Most people will only have one type of student loan. However, if you have borrowed under both repayment schemes you may be able to choose which loan you repay first. You can get further advice by calling the Student Loans Company.
Additional links
Student loan repayment: online services
Use your online account to update personal details, check your balance or make a payment
