“My student loan repayment took six years”

Former student Rebecca Gale said she was “surprised, shocked and then angry” after getting a student loan repayment six years after she finished paying it off.

The 35-year-old believed she last heard from the Student Loans Company (SLC) when she made her last payment in 2015.

But just days ago she got a message on her phone saying she was owed £ 1,109.

“So when I first got the voicemail I thought ‘this is a scam’.

“But we checked, called and at first I was surprised and delighted because who doesn’t love a refund?”

Rebecca’s opinion on the matter began to change when she began to realize that the money had been with SLC for six years when it should have been in her account.

My money not theirs

The Manchester University graduate said: “To be honest I was a little angry. I wanted to understand how it could take so long to pay off something that should have been in my bank account for over five years. years.

“We’re not talking about the difference between putting food on the table or dressing my kids, but £ 1,100 is still a month of mortgage paid off, it’s a month of childcare costs or £ 1,100 of credit debt that I could have paid off.

“The point is, it’s my money and it should have been in my account and not theirs,” said Rebecca, who lives in the Yorkshire Dales.

The SLC told Money Box that it received new information from HMRC in May 2021 about Rebecca’s student loan repayments in the 2010-11 tax year, which meant she paid in too much and was eligible for a refund.

SLC said that as soon as he got this new data, he tried to contact Rebecca with the end result of the money that hit her account just a few days ago.

Why overpayments occur

SLC has a poor overpayment record, although it is improving.

This is because he was getting annual updates from HMRC which kept track of how much people had paid off their student loans through PAYE.

In April 2019, these updates went from once a year to once a week, making the system much more efficient. Nonetheless, in the first year of the new system, over 54,000 former students still overpaid £ 23million between themselves, an average of £ 424 each.

People are now also encouraged to repay the last two years of their loan repayments by direct debit to further limit the risk of overpayment, with some repayments also taking place automatically (for amounts up to £ 750).

Money Box reached out to HMRC to ask why it took six years to send SLC new information about Rebecca’s historical payments. In a statement, he said: “Following a routine analysis of our cases earlier this year, we identified a small number of instances where reimbursement information had not been submitted to SLC.

“We corrected these cases as soon as they became known and notified SLC so they could update their records.”

You can hear more on BBC Radio 4’s Money Box program Saturdays at 12 p.m. on Radio 4 or by listening again here shortly after the broadcast.

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