Tag Archives: student loan

Student Loan Interest Rate 09/10 Uncertainty

Saving Money, University
Happiness

*UPDATE 18/05/09* From September 09 the interest rate will be 0% for post ’98 loans. For Pre ’98 loans the interest will be -0.4%. Find out more here.

Will student loan interest rate be negative next year?

Yes, if the Government follow their method for calculating interest rate for post (and Pre) 1998 loans. The rate as of March 2009 stands at 1.5% (post ’98). This is calculated, according to Student Loans Company website (the company who collects and distributes the money on behalf of the Government):

“Student loans are not like commercial loans. They are subsidised by Government and attract a low cost interest rate. This interest rate is based on the annual March Retail Price Index (RPI) or the highest base rate of a number of major banks plus 1%; whichever is lower. Continue reading Student Loan Interest Rate 09/10 Uncertainty →

Student Loan Interest Down to 2.5%

University,
Happiness

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

Student Loan Interest Falls Again, Now 3%

University,
Happiness

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?

Continue reading Student Loan Interest Falls Again, Now 3% →