Student Loan from 2004. Now living in Nz finally got a letter. what to do?

[nonprayingmantis]

Hi guys,

 

had a read of the forums and my problem looks similar to some others, but want to be sure, so if you could help me out and put my mind at rest that would be great.

 

Here is my situation:

 

Graduated Uni in 2004 with around 14k GBP of student loan debt (all other debt like CC and overdraft was paid off)

 

Moved to NZ that year, without earning enough in the UK to hit the repayment threshold.

At the time, I sent the letter to them advising I was going overseas for more than three months and they should use my parents house in the UK for correspondence.

 

As it happens, I ended up staying in NZ and settled down (great country)

 

Since I sent that letter in 2004, I have had nothing from the SLC to my parents house. not a single letter, so I have made no attempt to contact them or do anything more as it just didn't seem that important if they weren't actively chasing me.

 

Now, out of the blue, a letter arrives to my parents house saying I need to fill out an overseas assessment form within the next two months or start incurring monthly default charges of 250 quid (per month!).

 

I do intend to pay it off, but right now can't afford the amounts I know they will assess on my income if i fill out the form and send it back as we have just had a baby and my wife isn't working, and won't for at least 1 year, plus my mortgage is astronomical right now

 

So I have a few questions:

 

1) my loan is 'new style' from 2000-2004, but since they haven't contacted me in over ten years and I have made no payments ever is the debt not considered to be statute barred?

 

2) If it isn't statute barred, and I remain in NZ permanently, is there any practical way they can pursue the debt or effect my NZ credit record?

 

3) Is there any way I can defer payments for a couple of years, even though my gross income is well above the threshold required

 

4) are the default charges they intend to levy of 250 quid per month actually legal? they seem absolutely massive (circa 20% of the actual debt amount per year)

(ETA: I think I misread this charge as a penalty charge, when actually it is just their guess as to what you should pay, so it will come off the loan if I pay it rather than being tacked on. still very high though)

 

5) If i don't pay but come back to the UK for a holiday, is there anything they can do like have me arrested at the airport?

 

5) If I move back to the UK (no plans, but could happen) will I suddenly owe the entire amount? and will it harm my Uk credit record?

Edited October 4, 2013 by nonprayingmantis

[Bazooka Boo]

AFAIK the new style student loans are what is termed 'contracts under seal' therefore it will be 12 years before it is SB.

 

There is absolutely no chance of you being arrested for this, being in debt is NOT a crime.

 

IMO I would not contact them for the time being.

[nonprayingmantis]

thanks for that Bazooka Boo.

 

So, if true, that means if I ignore them for a couple of years then I the detb will be statute barred and the only way they can then enforce repayment is if I return to work in the UK and earn over the threshold, and even then the repayment will only ever be 9% of myincome over the limit.

 

If that is the case, what about things like penalty interest rates etc? I've seen a few places state there are penalties if you don't make the payments they assess, but I'm struggling to find out how much these penelties are, and whether they are legal or not.

[Bazooka Boo]

I wouldn't worry about penalty charges/fees etc, this can be argued later on if needs be.

 

Once a debt is SB it can never be unbarred, so cannot be collected.

[dallion]

thanks for that Bazooka Boo.

 

So, if true, that means if I ignore them for a couple of years then I the detb will be statute barred and the only way they can then enforce repayment is if I return to work in the UK and earn over the threshold, and even then the repayment will only ever be 9% of myincome over the limit.

 

If that is the case, what about things like penalty interest rates etc? I've seen a few places state there are penalties if you don't make the payments they assess, but I'm struggling to find out how much these penelties are, and whether they are legal or not.

 

 

 

Hi,

 

just wondering if you ended up taking any action in relation to your post '98 student loan.

 

I am in a similar situation having recently been contacted by SLC and was wondering if / how you got the loan statute barred?

 

Cheers!