How will my repayments change if I take out a Postgraduate Loan?
It depends on the type of loan you took out for your undergraduate degree:
Plan 2 – if you started your degree after 1 September 2012 you’ll have a Plan 2 loan. Previously the threshold for repayment was £21,000, but in April 2018 this increased to £25,000. This means that once you’re earning over £25,000 per year you’ll pay 9% of anything you earn above this amount.
Plan 1 – if you started your degree after 1 September 1998 and before September 2012 you’ll have a Plan 1 loan. Your repayment threshold increases every year. Currently it’s £18,330. You repay 9% of anything you earn above this amount.
If you have both a Plan 1 and a Plan 2 loan you will repay 9% of anything you earn above £18,330. If you are earning above £18,330 but less than £25,000 your repayments will reduce the balance of your Plan 1 loan only. If you are earning above £25,000 you will be paying off both loans simultaneously (9% of your salary earned between the thresholds will go towards your Plan 1 loan, 9% of your salary earned above £25,000 will go towards paying off your Plan 2 loan).
The Postgraduate Loan is repaid in addition to your other loan repayments, and has a different threshold. You’ll repay 6% of anything you earn above £21,000. This is the same for both the Master's Loan and Doctoral Loan. If you take out both a Master's Loan and Doctoral Loan your repayments for the two will be combined, so you will still pay 6% of anything you earn over £21,000, you will just be paying off a larger amount.
You can see how taking out a Postgraduate Loan will affect your student loan repayments below.