The Education (Student Loans) Regulations 1997

Time and manner of repayments

8.—(1) Subject to paragraphs (2) and (3) and regulations 9 to 12 a borrower shall commence repayment of his loan on such day in the month of April next following the date on which he ceased to attend the course as the loans administrator may determine in his case (referred to below in this regulation as “the determined date”).

(2) Where a borrower ceases to attend his course without completing it and on the first day thereafter on which it is reasonably practicable for him to do so begins to attend at the same institution another course which satisfies the requirements of regulation 4(1), paragraph (1) shall apply only in relation to the latter course.

(3) Where a borrower has ceased to attend his course so that paragraph (1) applies but another loan is made to him in respect of his attendance at another course he shall not be obliged to make repayments in respect of the first loan after the date on which the second loan is made, and thereafter the time and manner of repayment of the first loan shall be the same as the time and manner of repayment of the second loan.

(4) Subject to regulations 9 to 12 repayments shall be made in 60 monthly instalments calculated in accordance with paragraphs (7) to (9) in the case of a borrower who has received a loan in relation to less than five academic years and in 84 such instalments calculated as aforesaid in all other cases.

(5) Interest accrued on a loan shall be added to the loan at regular monthly intervals and thenceforth form part of the outstanding amount of the loan.

(6) On or before the determined date, the amount of the monthly repayments shall be calculated in accordance with paragraph (7).

(7) The amount of the loan outstanding on the first day of the month in which the determined date falls and of interest which will accrue during the period of repayment shall be divided by the number of repayments, and the amount so calculated shall be the amount of the monthly repayment until it is re-calculated in accordance with paragraph (8).

(8) On 1st September next following the determined date, and on each subsequent 1st September until the loan has been repaid or cancelled, the amount of the loan outstanding on that date and of interest which will accrue during the remaining period of repayment shall be divided by the number of repayments still to be made and the amount so calculated shall be the amount of the monthly repayment.

(9) For the purposes of calculating monthly repayments under paragraphs (7) and (8)—

(a) no account shall be taken of any repayments due prior to the relevant date which have not been made, but account shall be taken of the amounts of interest which have accrued on such unpaid repayments; and

(b) it shall be assumed that—

(i) the rate of interest will not change during the period of repayment; and

(ii) each repayment will be applied to reduce the amount of the loan immediately after the addition of interest in accordance with paragraph (5).

(10) Repayments shall be made by direct debit from the borrower’s bank or building society account unless the loans administrator agrees otherwise.

(11) Nothing in this regulation shall be taken to prevent a borrower, after giving notice to the loans administrator, from discharging or with the agreement of the loans administrator reducing his liability in respect of his loan sooner than required by the regulation, and where a borrower wishes so to reduce his liability the amount and time of repayments shall be determined by the loans administrator and the provisions of this regulation (except paragraphs (5) and (10)) shall not longer apply to the loan.