www.iva.co.uk

Hi, Can you please tell me whether student loans (university loan) can be included in the calculation. I have rung several help-lines and none of the advisors know the answer! My son owes £12.5k without the student loan but nearer £19k if it is included. Many thanks

Hi kj,
I'm sure I saw a post on the site recently from one of the IP's stating that the issue of student debt and IVA eligibility depends on when the student debt was taken.
I think I remember that at some point it became no longer possible to include student loans in the IVA.
I'm sure one of the IP's will get a definitive answer to you shortly.

Andrew Graveson
Independent Mortgage Broker & MD Bright Oak Debt Management
andrew@brightoak.co.uk
www.brightoak.co.uk

Hi kj,

The Student Loans Company generally require an 80p dividend for an IVA. Thus these are often excluded from IVA applications with debtors continuing to pay them off separately.

Are you currently repaying your student loan?

Kind regards,
Terry Balfour
IVA.com

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There are two different kind of loans available through the Student Loans company. One is an Income Contingent Student Loan which would usually date from 1997 onwards. This type of loan is paid back when you are earning a certain amount of money and the deduction is usually taken direct from your paye salary. An Income Contingent Student Loan CAN NOT be included in an IVA. The other type is the older Student Loan which would usually have been taken pre 1997. This loan CAN be included in an IVA but as previously stated will often only vote yes to a high return on their money. Thus if this debt forms more than 25% of the overall debt then an IVA will be hard to agree if you can not reach the high dividend (with an argument that you should be doing a debt management plan if you can).

Please note that both the above styles of loan CAN NOT be included in a bankruptcy.

Best Regards
Oliver

Thomas Charles and Co Ltd.
Experts in personal debt solutions.
Read customer feedback at: www.thomascharles.com/about_us.asp

Hi KJ

I had a student loan which I took out in 2001 (new type of loan) and this WAS included in my IVA. There seems to be so much conflicting advice about student loans! IP's don't usually include them if they make up more than 25% of the total debt as the student loans company usually vote no. They had about a 16% share of my total debt and they didn't bother voting.

Devonlass

Hi
That's interesting and goes against Melanie Giles advice regarding this.
Are you sure that it is binding because even in bankruptcy the new style loans can,t be written off.
Check with your IP as you do not want a nasty surprise in the future.
Regards

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

Hi Andy,

My IP is Melanie! So I don't think she would have made an error.

This previous thread (mainly Melanie's comments) might shed a bit of light on the whole student loans confusion!
http://www.iva.co.uk/forum/topic.asp?TO ... dent,loans

Devonlass

Ah ... well ... you'll do ok then DevonLassie [:)] (that was supposed to be said in a Somerset accent ).I donlt think the Student Loand were included in my IVA.

Debbie

www.babynamings.co.uk

www.soulgrowth.co.uk

Thanks Soulgrowth[:)]

Ohhh arrrhhhh.....erm, that was supposed to be my Devonshire accent!

Hi
Thanks for that and i,m glad to be corrected.I'm confused now !!
Will have to get advice on this subject when she returns from holiday.
My info came from a Thomas Charles post

Posted - 26 July 2007 : 16:04:28
--------------------------------------------------------------------------------

Income Contingent Student loans (which were used from c1997 onwards) can not be included in an IVA and would be payable outside of the IVA. Student Loans (old style) taken before this can be included in an IVA (but not bankruptcy) but are often kept out if they form a big percentage of the dent as Student Loans Company will sometimes demand a high dividend (up to 90p in the £). This is usually allowed by the IP and then in turn the creditors.

Best Regards
Oliver


Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

Hi Andy

Your comments have got me thinking now and i'm getting slightly nervous in case there has been some horrible mistake with my IVA!!

I've just looked at my IVA and the SLC are definately listed as a creditor bound by the IVA terms. I'm sure that if Melaine had made a mistake (which to be honest is going to be unlikely) the SLC would have put her straight with regards to not being in the IVA!

Devonlass

Hi Devonlassie

When did you take your first student loan out because mine span across the changeover from the old style to the new style and these were all included as I took my first year loan in 1995 and my last year in 1998 but they were all classed as old style and included in my IVA.

Hi
Thanks,that could be the answer and Devonlassie don't worry Melanie will not be wrong,I just want to clarify the student loan situation with her when she gets back
Regards

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

Thank you all for your replies. I hadn't expected so many responses. It seems that it is a bit of a grey area so I guess it's a case of try it and see. My son has been paying his student debt when in work, but due to very poor health he is unable to work all the time. The student debt (1999 - 2002) , a loan and credit card was taken on when he was healthy and when he can't work, I pay (around £400 a month). With a young family, the debts are causing him a lot of problems.
Again, many thanks,
Eloise (KJ in my first post on this topic)

Hi Melanie

Hope you had a relaxing holiday?

Since you're back now perhaps you could clarify the mystery of the student loans!

Devonlass