Students who started in higher education before September 1998 would have taken out a fixed-term (mortgage style) loan. These loans, which were introduced in 1990, are repaid in a fixed number of instalments - normally 60. Typically, account holders start to repay their loan in the April after they graduate or leave their course. However, repayment can be deferred on a yearly basis if the repayer’s income is below 85% of the national average.

Deferment

Account holders can apply to defer their repayments for a year at a time if their gross income is less than 85% of national average earnings. Eligibility for deferment is based solely on the repayer’s income. Customers receive a letter and a deferment application form from the Student Loans Company in the February after they graduate or otherwise leave their course, advising them that they will be entering repayment in the April of that year. Customers who believe that they are eligible to defer, complete and return the form to us. Those who do not defer are automatically liable to begin repayment.

During the deferment period the loan continues to accrue interest