Student Finance

Student Debt

Uni Compare  · Dec 7th 2021

Student debt is an inevitably at university, whether it’s self-inflicted or it’s part of a policy by a government to ensure that students pay their way. Either way, it’s an absolute in the university world.


Not all student debt is bad debt, as strange as it sounds, and it is often in a manageable when leaving university, especially in the case of a student loan, but there is a lot more to student loan debt than just simply paying off money that you owe.

In this article, we will answer some questions like when does student debt get written off and does student debt affect a mortgage application?

Understanding student debt

What do I pay back with my student debt?

Most student debt is made up of two things, three if you have studied at a postgraduate level as well, which are:

  • Tuition Fee Loans
  • Postgraduate Loans (assuming you studied at postgraduate level)
  • Maintenance Loans

Any university grants, bursaries or scholarships do not need to be paid back.

Obviously, if you have been paid too much in your bursary, grant or scholarship, you will need to pay the surplus back. You will also still have to repay your student loan if you leave your course early.

Student debt repayment is not just unique to the UK. In the US, student debt in 2014 topped almost $1.3 trillion.

When is student debt written off?

This depends on the university and how much money you have to repay, but usually, most student debts are written off entirely after thirty years.

Student debt write off also depends on the plan that you are on as well. Our student loan repayment article goes into this in more detail, but essentially, you have two student finance plans, which dictate the rules for repayment and write-offs.

  • Plan 1 Loans: This and other loans (like a mortgage) vary more for when they are paid off. The circumstances will dictate repayment.
  • Plan 2 Loans: These are written off after thirty years, assuming you started studying in England or Wales on or after 1st September 2012.

UK student debt is, however, permanently written off if you become permanently disabled or can prove you are unfit for work.

But if you die what happens to your student loan debt?

Then it is written off then too, these are the only ways to get rid of student debt early, short of paying it off, so there is no point looking for how to get rid of student loan debt legally, since these are the only ways, and you should very obviously stay clear of illegal methods.

Student debt

How much student debt do I have?

This will depend on your student circumstances, you can log into student finance and see what your outstanding balance is there, but you will receive letters that will tell you more about your repayments and you will be able to call up and speak to them too.

The average UK student debt is around £45,000.

You can view how much your student debt is, by using a student debt calculator or a student debt repayment calculator as well.

Who owns student loan debt UK?

Student debt is paid back to Student Finance, a company that manages all student debt in the UK.

US student debt

Student debt repayment is not just unique to the UK. In the US, student debt in 2014 topped almost $1.3 trillion.

The average student debt in the USA, is around $37,000.

The average UK student debt is around £45,000.

Does student debt affect getting a mortgage?

On paper, most mortgage lenders do not consider student debt too much when considering people for a mortgage, especially if there are multiple people on the mortgage, but student finance debt can still be taken into account for some lenders.

From a saving perspective, it can be more difficult to save when you have student debt. This is because you now have an additional amount of money leaving your account every month, thus meaning you have less to save.

If you start to earn more money, your student debt (and by definition, student debt interest rate) will rise, which means that your monthly outgoings will be affected as well. It can also affect the repayment rate for your mortgage as well.

Student debt can also affect your credit score. Now, it won’t affect it in a major way, unless you start missing payments, but your credit score is representative of the amount of money you have to pay each month as well as other financial histories.

UK student debt statistics

In the UK, £16bn is loaned out a year, to around one million students each year. By March 2019, the value of the loans reached nearly £121bn and the government forecasts the value of those loans to reach the £450bn mark by 2050, according to a report from Parliament UK.

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