MSE News

Scottish and have a student loan? It may now be written off sooner

Student loans for Scottish students who started university from 1998 onwards will now be written off after a maximum of 30 years, meaning many are likely to pay less.

At the moment, the rules vary depending on when you started university:

  • If you started university between 1998 and 2006 – your loan is currently wiped when you reach 65.
  • If you started university after 2006 – your loan is currently wiped 35 years following the April after you graduated.

But an amendment to Scotland's student loan regulations means that from December:

  • If you started university between 1998 and 2006 – your loan will be wiped when you reach 65 or 30 years from the April after you graduated – whichever is sooner.
  • If you started university after 2006 – your loan will be wiped 30 years following the April after you graduated.

The rule change, which was widely expected to be put into law this year, was rubber stamped by members of the Scottish Parliament yesterday.

Are you wondering: Should I repay my student loan? See Martin's guide.

Who does the rule change affect?

The rule change affects those who lived in Scotland immediately before starting their degree, and started university in 1998 or later.

If you're from a different part of the UK and went to a Scottish university, you're not affected. But if you're from Scotland and went to a university elsewhere in the UK, you are.

How do Scots pay back their student loans?

If you applied for your loan in Scotland from 1998 onwards, you'll be on what's known as a Plan 1 loan. 

This means you'll pay 9% of the income you earn over the 'repayment threshold'. This is £18,330 per year at the moment, but it regularly rises.

You keep paying until you pay off your loan in full – which some will already have done – or until your loan is wiped, which is what the rule change in December will alter.