Student loan interest rates and repayment threshold changes
11 August 2022
The Department for Education (DfE) and the Student Loans Company have confirmed the interest rates and repayment thresholds for income contingent student loans. Also confirmed are the interest rates and deferment threshold for mortgage style student loans.
Plan 1
From 1 September 2022 the interest rate will be 2.75%. This is the bank rate plus 1% and may be adjusted during the year, if the bank rate is to change. The low interest rate cap is in effect, should this no longer apply the rate will become 9%, the applicable rate of Retail Price Index (RPI).
From 6 April 2023 the repayment threshold will rise to £22,015.
Plan 2 and postgraduate
Interest rates for plan 2 are usually between RPI and RPI plus 3%. However on June 11 2022, DfE ministers announced that this would be capped at 7.3% for those on plan 2 and postgraduate loans.
From 1 September 2022 to 30 November 2022 the maximum interest rate will be 6.3%.
From 1 December 2022 to 31 August 2023 the maximum interest rate will be 7.3%
From April 2023 the repayment thresholds will be:
- plan 2 – £27,295
- Postgraduate masters and doctoral loans – to be announced.
Mortgage style loans
From September 2022 the interest rate will be 9%, in line with RPI.
The deferment threshold for these loans will be £35,092
Information provided in this news article may be subject to change. Please make note of the date of publication to ensure that you are viewing up to date information.