UK student loans: How much you can borrow, how and when to repay, details inside

Undergraduates may borrow tens of thousands of pounds to complete their education, but the criteria for repaying student loans can be complicated.

What are you going to borrow?

"Student loans are a complex issue, and there are many fallacies out there," says Paula Roche, managing director of consumer solutions at Equifax UK. "It’s important students understand the repayments, their obligations and the implications for future borrowing.”

This will be determined by the date of your degree, where you are from, and where you choose to study.


English institutions can charge up to £9,250 per year for home students. Undergraduates in England can also apply for a maintenance loan of up to £12,667 to help with living expenses. Maintenance grants were phased off in 2016.

Loans do not have to be returned until you graduate, but they accrue interest while you are still enrolled.

What is the current interest rate?

Student loans collect interest from when the first payment is made into your bank account or to your university until the loan is fully repaid or terminated. Compound interest is calculated daily and applied to the debt each month.

The rules vary depending on the repayment plan you are on: there are four options, but if you are an English or Welsh student who began an undergraduate course anywhere in the UK in the last decade, you are on plan 2, so we have looked at this option.

FAQs:

1. Are student loans available in England?
   If your study in the UK and you have a first degree, you may be eligible for student funding.
2. How do student loans operate in the United Kingdom?
   Once you earn a certain amount, you begin repaying. The size of your monthly payments will be determined more by how much you make rather than how much you owe. You will be charged interest from the day you take out the loan. The terms and conditions are subject to change.