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Student Loan Repayments: A breakdown of the changes 

Did you know as of the 6th April 2021, the student loan repayment scheme had changed? At the beginning of this month, both the UK and Scottish governments introduced new payment programmes for all UK undergraduate students. DAM have put together a short breakdown of the changes made:

England, Wales and Northern Ireland

As it stands, there are 3 main types of repayment programmes- Plan 1, Plan 2 and Postgraduate loans. Plan 1 is for students from England and Wales who took out a student loan before 2012, and all students from Northern Ireland who have took out a loan since 1998. Plan 2 relates to students from England and Wales who have took out a loan after 2012. The changes are:

  • Plan 1: The repayment threshold will increase from £19,390 p.a. to £19,895 p.a. Your weekly or monthly repayment will remain at 9% of the amount you earn over the threshold.
  • Plan 2: The repayment threshold will increase from £26,575 p.a. to £27,295 p.a. Your weekly or monthly repayment will remain at 9% of the amount you earn over the threshold.
  • Postgraduate: The repayment threshold continues to be £21,000 p.a. Your weekly or monthly repayment will remain at 6% of the amount you earn over the threshold.

Scotland

The Scottish government introduced a new student loan repayment type known as Plan 4. It will see all incoming Scottish students being placed on Plan 4 and all existing Scottish students with a Plan 1 loan move to Plan 4. The change will happen automatically. The new repayment programme is:

  • Plan 4: The repayment threshold will be raised to £25,000 p.a. Your weekly or monthly repayment will remain at 9% of the amount you earn over the threshold.

For more up-to-date information regarding your student loan you can visit the Student Loans Company here or the Student Award Agency Scotland here 

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