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Student loan interest rates have fallen for the second month in the row after the Bank of England lowered the base rate to 1.5%. This has led to the student loans interest, falling to 2.5%, this took effect from the 9th January. Good news! For an explanation of how the rate is set please see my previous post, when the interest rate went down in December to 3%.
Keep smiling!
Martyn
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| photo by jenn_jenn’s |
Welcome to the thirteenth money making report, here’s the last one.
Well, this turned into a bad month! Matched.co.uk closed down on the 19th November 2008, which is obviously a great disappointment. Matched.co.uk had proved to be quite a handy little earner. For all its little drawbacks it will be missed. End of obituary. Time for some figures….
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Student loan interest rates fell in September, from 4.8% to 3.8% as reported here.
But now even more good news, student loans are again seeing another fall in interest from the 5th December. The new rate is 3%. Which should bring some welcome festive cheer to most students and those paying back their loan.
But why the sudden change?
The interest rate is usually set by the Retail Price Index figure for March, this then sets the rate from the September following. Alternatively, if lower, the rate is set from “the highest base rate of a number of major banks plus 1%”.
Usually RPI is lower. But due the current ‘credit crisis’, the Bank of England has been slashing the base rate. It currently stands at 2%. This has led to the interest rate on Student loans being reduced to 3% from the 5th December 2008.
So what does the future hold? Will rates go up or down?