Thinking of going to university? Or maybe you’ve already graduated and wondering what the deal is with your student loan? Either way, you’re not alone — it’s one of those things most of us sign up for without fully understanding. No worries though, this guide is here to make things simple.
We’ll break down what student loans actually are, how much you might borrow, how and when you pay them back, and what happens if you never do. And no — it’s not as scary as it sounds.
How Much Student Loan Can You Borrow?
In short, it’s a loan from the government to help cover the cost of going to university — things like tuition fees and everyday living expenses. You don’t need to pay anything upfront, and repayments only start when you’re earning enough.
Depending on where you live in the UK, you’ll apply through:
The Two Bits of Student Loan
There are two main parts:
- Tuition Fee Loan — covers your course fees. This gets paid straight to your university.
- Maintenance Loan — helps with day-to-day costs like rent, food, and transport. This goes into your bank account in instalments (usually three times a year).
How much maintenance loan you get depends on things like your household income and where you’ll be living.
How Much Student loan Can Borrow ?
Here’s a rough idea for students in England (2024/25):
- Living at home: up to £8,610
- Living away (outside London): up to £9,978
- Living away (in London): up to £13,022
For tuition fees, most students borrow up to £9,250 per year — that’s what most unis charge. In Scotland, if you’re studying at home, the government usually covers tuition for you.
When Do You Start Paying It Back?
You won’t pay anything until the April after you finish your course, and only if you’re earning above a certain amount. If you don’t earn that much? You don’t pay anything.
There are different “repayment plans” depending on when you started:
- Plan 2: If you started uni in England after 2012, you’ll repay 9% of anything you earn over £27,295 a year.
- Plan 5: Newer students (from 2023 onwards) repay 9% of earnings over £25,000 a year.
It’s taken automatically from your salary — no need to set up payments yourself.
Is There Interest?
Yep, student loans do have interest, but it’s not as scary as it sounds. The rate is linked to inflation (called RPI), and how much you earn.
The key thing? After a set number of years (usually 30 or 40, depending on your plan), anything you haven’t paid is wiped. No one’s chasing you forever.
What If I Never Earn Enough?
Good news: if you never earn above the threshold, you’ll never have to repay anything. And after the time limit is up, the loan is cancelled. Simple as that. It doesn’t go on your credit report, and it doesn’t affect getting a mortgage.
Tips for Getting It Right
- Apply early — especially for the maintenance loan. You don’t want delays.
- Check what plan you’re on — it affects how and when you repay.
- Keep your details up to date — especially if you move or change jobs.
- Don’t panic about paying it off early — it’s not always worth it. For many, it gets written off before it’s paid off anyway.
After Uni: What Next?
Once you’re earning enough, repayments kick in automatically. If you’re PAYE, it comes out of your wages like tax. If you’re self-employed, it’s sorted through your Self Assessment.
Planning on postgrad study? You can apply for a Master’s Loan — up to £12,167 (for 2024/25). It’s a separate loan with its own rules.
Final Thoughts
Student loans in the UK aren’t like regular loans. They’re more like a graduate tax — you pay a bit back if and when you’re earning enough, and if not, that’s okay too.
So if student debt is the one thing putting you off going to uni, take a breath. Understand how it works, don’t let it freak you out, and focus on getting the most out of your studies. The rest will fall into place.
