Finance gurus are calling on all former university students to check their documents, as it’s believed more than a million could be in line for a refund of up to several thousand pounds. The consumer advice website Money Saving Expert (MSE) has warned numerous Brits might have paid too much towards their student loans.
These loans provide the means for students to pay for their education and living expenses while studying. However, they can also result in substantial debts that linger long after graduation.
It’s estimated that annually, more than one million graduates may have contributed more than necessary towards their loan repayments. In a recent Facebook post, MSE alerted followers: “Left uni at any point in the last 10 or 15 years? Check now if you can reclaim £100s or even £1,000s.
“Every year 100,000s of university leavers overpay their student loans, often without realising!” Further details were provided on the MSE website, which was established by financial expert Martin Lewis.
The site stated: “Many have student loan repayments automatically deducted from their wages each month, and assume all is well. Yet 100,000s accidentally overpay their student loans each year, often without realising.
“Here’s how to check if you’re one of them and, if so, how you can reclaim £100s, or even £1,000s. In the last tax year alone, over one million university leavers overpaid their student loans, according to the latest figures released by the Student Loans Company (SLC).”
The website offered guidance to help former students establish whether they’ve been impacted by these excessive payments. However, this only covers those who attended university within the past 27 years – meaning their studies must have commenced in 1998 or afterwards.
“Over recent years, the Student Loans Company has introduced a number of initiatives to reduce overpayments and improve the repayment process for students,” it said. “This includes introducing an online repayment service, issuing automatic refunds and actively contacting those who might have overpaid.
“While these changes have helped to reduce the number of students making overpayments, more than a million former students still overpaid in the 2022/23 tax year – so it’s well worth checking.”
According to the site, there are four main reasons you might have overpaid your student loan:
- Payments were deducted from your pay packet on some months despite not earning enough in the full year to take you over the repayment threshold
- You’re on the wrong payment plan by default
- You’ve started repaying too early
- You had money deducted after the loan was fully repaid
To find out more and to check if you could have overpaid you can visit the MSE website here.
How to reclaim your funds
The process for recovery varies depending on the cause of your overpayments. If you have made loan repayments during particular months whilst not meeting the annual earning threshold, you may apply for your refund through SLC’s online platform.
If you find yourself mistakenly on the incorrect student loan repayment plan, it’s essential to get in touch with your employer or ring up the Student Loans Company (SLC) directly at 0300 100 0611.
Additionally, if you’ve commenced loan repayments prematurely, you should also contact SLC. But if deductions continued after settling the loan in full – there’s no action required on your part.
MSE clarified: “If you’ve paid over your loan balance and additional payments are taken, you’re due a credit balance refund. You don’t need to do anything for this, if SLC can verify your bank account is still active and used by you, a refund will automatically be paid into your account.
“It’s crucial to keep your contact details current, including bank information and email address. Otherwise, they’ll reach out to inform you about how to claim your refund. If you’ve overpaid and haven’t been contacted by SLC, you can request a refund.”
Several MSE users have shared their success stories regarding reclaiming funds. One called Melissa said: “Just wanted to say a massive thank you as I read your article on overpaying on student loan repayments and realised there was a chance I had overpaid.
“Turns out I had and I’ve since received a refund of £900! I’ve been doing house renovations this year so this money has been incredibly handy in going towards them.”
Lisa also said: “I spent 15 minutes on the phone and got £555 back for overpayments on my student loan. Most was because of my maternity leave. Thanks so much, couldn’t have come at a better time.”
