Question:
OK its boring (student loans company), and I'm almost embarrassed to explain the situation but I could use a little advice so I was paying £70 to a debt collection agency in order to pay arrears on my student loan. I was under the impression that this would be an ongoing arrangement until my loan was paid off. After about 6-10 (not certain of how long this arrangement lasted) months of this I got a letter from the student loans company saying I now owed them £1100 in arrears!! I wasnt able to pay this and I offered to continue my existing arrangement which I was told would be OK.

Well no money went from my bank account and I called them about 6 weeks later to find out what was happening only to be told they had passed it onto a (different) debt collection agency. Ive now contacted this agency and offered them £100 a month (which is close to the maximum I can afford due to helping my partner with her/our debts) which they are refusing to accept since I am not eligible to defer the loan repayments and they are insisting that the minimum they will accept is £220 a month. At my wits end with them I told them that we might as well sort it out in court.

Anyways, my question is that given that at NO POINT was I informed that I was accruing additional debt (although I suppose I should have realised) and that I've made a reasonable offer to repay the existing debt (although Ill obviously be falling short of ongoing payments) what options do I have and if this goes to court (as is likely it seems) - is it likely the court would accept my repayment offer is reasonable? - would the lack of information regarding the fact that I was becoming increasingly in debt be taken as a mitigating factor? - would the lack of action to inform and recover the increasing debt make this action reasonable? - would I be liable for court costs? Any advice or perspective appreciated.

Answer:
How long is it since you left university? If it's within the past year or two you could try approaching the Student welfare part of your Students Union office (if you were in the SU), they might be able to help with advice etc. Just a suggestion. I don't undertsand how you can be 'in arrears' to the Student Loans Company. You don't need to pay anything unless you are earning over ??10k pa, and after that it is taken automatically from your pay via the PAYE system. The only case in which the arrangements are different are if you are self-employed. Perhaps you could explain a little more about your employment siutation? I have always found the SLC to be arrogant to the point of rudeness, talk about lack of customer service! If they take you to court, then the court will consider if your offer is reasonable. If it is then no judgement will be given and the company are stuck with it. The court will also take into account the fact that £80 was accepted by the creditor as reasonable (the change of company is irrelevant to the court). If no judgement is given, then no court costs would be awarded against you. In any case a debt of £1100 would likely qualify for the small claims track, so the only cost that could be awarded is the court fee (<£100). You do not have to pay your loan back until you are earning more then £15,000 for the mid nineties student loans, but you must apply for deferment!!!!!!!!