Graduates working abroad repay higher student loan payments
Graduates who move abroad without informing the Student Loans Company (SLC) could end up automatically paying back their loans, additionally students living and working abroad may have to repay their loans at higher rates and earlier as thresholds for repayment are lower.
The Student Loans Company has reported that more than 13,000 people have been put default payments in the last 12 months with over 1,000 people tracked down by tracing agents. Many students wrongly believe that moving abroad for a certain number of years cancels out their loan, whilst in fact they are still liable to pay back their students loans, and if the SLC have to track you down then you will be liable for those costs as well.
Many graduates also do not know that repayments are based on the living standards of the country, with the threshold lower for several countries, with it being set at only £6,000 per year in places like China or India, so a student living there would pay earlier than a similar student living in the United Kingdom where you only pay back when earning over £15,000 a year. Additionally payments rates can also be higher than the in the UK for people working undeclared abroad with rates in America set at £196 and New Zealand’s £246.
With current graduate unemployment at the highest levels for many years working abroad will be seen as a viable alternative to many students; however they must ensure that they do not neglect to tell the SLC.