UK Student Loan Guide 2025-26

Your plan depends on when and where you studied: Plan 1 - Started undergraduate study in England or Wales before 1 September 2012, or Northern Ireland students (any year). Current threshold: £24,990/year. Plan 2 - Started undergraduate study in England or Wales on or after 1 September 2012 (up to 2023). Current threshold: £27,295/year. Plan 4 - Scottish students (and EU students who studied in Scotland). Current threshold: £31,395/year. Plan 5 - Started undergraduate in England after August 2023. Threshold: £25,000/year. Postgraduate Loan - Masters or doctoral students who borrowed from the Student Loans Company for postgraduate study. Different repayment rules apply (6% above £21,000, write-off after 30 years). Check your payslip for the deduction code, or log in to www.gov.uk/student-finance to confirm your plan.

For most Plan 2 and Plan 5 borrowers, the honest answer is probably not. Institute for Fiscal Studies research suggests that only around 25-30% of Plan 2 borrowers repay in full before write-off; the majority will have remaining debt written off. Average debt at graduation (Plan 2, England) is now typically £40,000-£60,000 including interest. At a salary of £35,000, monthly repayments are £64 (Plan 2), rising as salary grows. If balance is £50,000 and salary grows at 3%/year, many borrowers will have substantial balances written off after 30 years. Plan 5 borrowers have a 40-year write-off period and a higher proportion are expected to repay in full due to stricter terms.

For most Plan 2 borrowers: almost certainly not. Here's why: if you're likely to have debt written off (i.e., you won't repay in full at the fixed 9% rate), making overpayments means you're paying more than you're legally required to with no benefit - you'd have paid the same regardless. The write-off happens regardless of the outstanding balance. Overpaying only makes sense if: (a) you are certain you'll repay in full before write-off, (b) you want to eliminate the psychological burden of the debt, or (c) it significantly affects your mortgage affordability. Consult our student loan calculator to see your repayment trajectory. Exception: Plan 1 borrowers close to paying off their loan may benefit from overpayments to clear it.

Student loan repayments are deducted from salary automatically via PAYE, reducing your take-home pay. Mortgage affordability assessments use your net income (take-home pay), so repayments do reduce how much you can borrow. The loan doesn't appear as credit card or personal loan debt on credit checks - it's not scored negatively. A £500/month student loan repayment could reduce mortgage borrowing by roughly £100,000-£120,000 depending on the lender's income multiple. Some lenders assess affordability based on take-home after deductions; others add back student loan repayments. Always be transparent about student loan repayments on mortgage applications - this is a legal requirement.

Your repayment obligation continues if you move abroad, but the thresholds and amounts are adjusted for the country you're living in (based on comparable earnings). The Student Loans Company (SLC) asks you to voluntarily provide income information annually. You make repayments at the appropriate percentage above your country's equivalent threshold. Critically, ignoring your student loan abroad is a serious mistake - the SLC can obtain county court judgments in the UK against you, affecting your credit file and ability to return to the UK financially. The loan is still written off at the normal expiry date - you don't accrue extra time abroad.

Yes - interest accrues on your student loan balance regardless of whether you're earning, employed, or making repayments. No repayments are required if your income is below the threshold, but the balance continues to grow. For Plan 2 borrowers, interest is RPI (Retail Price Index) plus up to 3% while studying and in the first year after graduation, then based on your salary (RPI only at £27,295 threshold, rising to RPI+3% above £49,130). For Plan 5 borrowers, interest is set at RPI. Interest rates change in September each year. During high inflation periods (e.g., 2022-23 when RPI hit 12%), this caused substantial balance increases for many borrowers.

Write-off dates vary by plan: Plan 1 - when you reach age 65 (if you took it out before 2005) or 25 years after the April you first became liable for repayments. Plan 2 - 30 years after the April you first became liable for repayments (typically around age 52). Plan 4 (Scotland) - 30 years after the April you first became liable. Plan 5 - 40 years after the April you first became liable. Postgraduate Loan - 30 years after the April following graduation. Written-off student loans are not taxed as income - they are simply cancelled with no tax consequence. The write-off date is fixed and doesn't change if you stop earning or defer repayments.