New Debt Crisis

[Obelix 11]

Sorry, but no banana.

 

It’s RPI + 3%

 

Try again....

 

Why try again? What have I to prove?

 

You asked why it';s not a debt I told you.

 

As for the 3% over RPI - when was the last time you saw a mortgage at the inflation rate? Theres a cost associated with running these schemes, people die, the capital isnt recovered. Obviously there will be an amount over the base rate.

[phil752 10]

Why try again? What have I to prove?

 

You asked why it';s not a debt I told you.

 

As for the 3% over RPI - when was the last time you saw a mortgage at the inflation rate? Theres a cost associated with running these schemes, people die, the capital isnt recovered. Obviously there will be an amount over the base rate.

 

Isn't the real problem people going to university that wil never get a degree of merit to allow them to get a job that will allow them to pay the debt off. Now i don't blame people, going into now to go degrees, but universities that now treat degrees like selling cars, it just a business to them.

Edited September 3, 2018 by phil752

[Obelix 11]

Isn't the real problem people going to university that wil never get a degree of merit to allow them to get a job that will allow them to pay the debt off.

 

I couldnt possibly comment as I have a useable degree. You have input to it though?

[ez8004 10]

Isn't the real problem people going to university that wil never get a degree of merit to allow them to get a job that will allow them to pay the debt off.

 

No, because the debt doesn’t need paying off. That is why thresholds exist because any repayment is made, the amount repaid is dependent on how much you earn.

[phil752 10]

I couldnt possibly comment as I have a useable degree. You have input to it though?

 

input to it?

 

---------- Post added 03-09-2018 at 22:53 ----------

 

No, because the debt doesn’t need paying off. That is why thresholds exist because any repayment is made, the amount repaid is dependent on how much you earn.

 

Duh sorry of course it does, we you me pay it off if the student does not

Edited September 3, 2018 by phil752

[I1L2T3 10]

The interest rate set by the student loans company is a complete red herring. IT DOESN'T MATTER WHAT IT IS. It can be 1000% and it wouldn't change how much you pay back unless you are earning VAST sums of money.

 

The system isn't rotten. You think it is because you fundamentally do not understand it.

 

All students have access to effectively low interest rate loans to go to university. In the current climate, the government cannot afford to pay for everyone's higher education. So this is the best it has come up with. To be honest, it is actually a great system, because it protects graduates who can't land a decent paying job. Where your stupid idea of taxing all graduates would punish them the most.

 

It’s not a red herring at all. There’s a very clear reason for it.

 

---------- Post added 03-09-2018 at 23:04 ----------

 

Why try again? What have I to prove?

 

You asked why it';s not a debt I told you.

 

As for the 3% over RPI - when was the last time you saw a mortgage at the inflation rate? Theres a cost associated with running these schemes, people die, the capital isnt recovered. Obviously there will be an amount over the base rate.

 

Even the SLC describe the loans as debt.

 

The +3% isn’t intended to cover unrecovered capital, or even death of borrowers.

 

In time the debt owed will balloon to approaching a trillion pounds.

 

Now who would be interested in a loan book like that? Like if the government decided to sell it?

 

Answer is that the system is monetised to support future private sales of parcels of the loan book. That’s the other major aspect of this scam - the goalposts can shift.

[ez8004 10]

It’s not a red herring at all. There’s a very clear reason for it.

 

---------- Post added 03-09-2018 at 23:04 ----------

 

 

Even the SLC describe the loans as debt.

 

The +3% isn’t intended to cover unrecovered capital, or even death of borrowers.

 

In time the debt owed will balloon to approaching a trillion pounds.

 

Now who would be interested in a loan book like that? Like if the government decided to sell it?

 

Answer is that the system is monetised to support future private sales of parcels of the loan book. That’s the other major aspect of this scam - the goalposts can shift.

 

Do you still not understand that the student's repayments are NO WHERE near is bad as it seems? Still think a £60k loan requires a repayment of £140k?

 

The goalposts CANNOT retrospectively shift. The terms and conditions of the loan you take out at the time you take it out is constant throughout the duration of the loan. There is precedence in this when the SLC created Plan 2 to supercede Plan 1.

[I1L2T3 10]

Do you still not understand that the student's repayments are NO WHERE near is bad as it seems? Still think a £60k loan requires a repayment of £140k?

 

The goalposts CANNOT retrospectively shift. The terms and conditions of the loan you take out at the time you take it out is constant throughout the duration of the loan. There is precedence in this when the SLC created Plan 2 to supercede Plan 1.

 

I understand totally. I already described as a very preferential form of debt with repayments structured like a tax.

 

It is still debt.

 

And, check your SLC contract.

 

Finally, as I said earlier stop defending this rotten system

[phil752 10]

I understand totally. I already described as a very preferential form of debt with repayments structured like a tax.

 

It is still debt.

 

And, check your SLC contract.

 

Finally, as I said earlier stop defending this rotten system

 

but why are universities selling courses that can not be paid back?

[truman 10]

It shows nothing of the kind.

 

 

 

Thats nothing to do with rent arrears being up. Do you honestly think people will just swallow stuff you spout without checking it and o you think we are that daft to not spot this sort of thing?

 

See my post #70...

 

---------- Post added 04-09-2018 at 00:35 ----------

 

Yes, it is still and debt. And people shouldn't forget, with this government the rules change and the goalposts move all the time.

 

Who's to say that 10 years down the line the government won't decide to hike up interest rates or that the unpaid debt won't be written off after 20 years after all, etc.

 

Who brought tuition fees in?

Edited September 3, 2018 by truman

[phil752 10]

See my post #70...

 

---------- Post added 04-09-2018 at 00:35 ----------

 

 

Who brought tuition loans in?

 

who do you think

Edited September 4, 2018 by phil752

[Cyclone 10]

Do you still not understand that the student's repayments are NO WHERE near is bad as it seems? Still think a £60k loan requires a repayment of £140k?

 

The goalposts CANNOT retrospectively shift. The terms and conditions of the loan you take out at the time you take it out is constant throughout the duration of the loan. There is precedence in this when the SLC created Plan 2 to supercede Plan 1.

 

Actually I think they've got form already for changing the terms retrospectively.

In any other loan arrangement that wouldn't be possible.

 

---------- Post added 04-09-2018 at 07:38 ----------

 

Look on Money Saving Expert. Do you want the link.

 

Lays out the reality.

 

I'm looking on it right now.

Did you put in a starting salary of 45k?

 

Did you fail to read this?

 

"Remember, this is based on your salary increasing to £194,490 by the time your debts clear (in 30 years)."

 

That's highly unlikely isn't it, but if they are on such a high salary then that repayment won't be too onerous.

 

Even if I change salary growth to 0, it applies RPI to the salary apparently.

 

"Remember, this is based on your salary increasing to £109,230 by the time your debts clear (in 30 years)."

 

It's probably better to ignore the effects of inflation I'd have thought for calculation purposes on both salary and loan.

 

If I set RPI to 0 and salary increase (true increase now) to 1% then the very lucky graduate who starts on 45k is earning

"Remember, this is based on your salary increasing to £60,660 by the time your debts clear (in 30 years)."

Probably a bit conservative given the huge starting salary, but hey.

 

This results in them paying off £73500 over 30 years.

£2450 on average a year (£204/month), against a career average salary of £52830 gross. Which is a net income of £3200/month.