Students with student loans who have defaulted on their debt have the lowest rates of repayment, according to a report.
The report, from the National Student Loan Recovery Agency, found the majority of students with student debt defaulted within six months of their first payday, and that nearly half of those who defaulted in the past year are aged 18 to 24.
The most common type of default is underpayment, with 26 per cent of borrowers with debt owing more than the average monthly income of £3,200, according the report.
While more than 40 per cent had borrowed from a loan servicer, another 30 per cent from the Student Loans Company of Australia and New Zealand, and 7 per cent in a private loan.
In a survey of more than 100 students, 44 per cent said they had borrowed on the advice of a servicer and 25 per cent on their own.
The NSLRA said that the average student loan balance in the first 12 months of a borrower’s life was £4,800.
Students who default in the course of the year are more likely to be in arrears and be in debt than those with no debts at all.
Those who default are also more likely than those who are not to be able to pay.
NSLRC director Richard Hargreaves said the findings were encouraging, and showed there was a need for changes to the system.
The report also found that more than half of borrowers were living in debt at some point during the year. “
There’s no guarantee that you’ll actually pay it off, so there’s no way of really getting people into repayment.”
The report also found that more than half of borrowers were living in debt at some point during the year.
The average debt is more than 10 times the average income, and the rate of default for borrowers who had a balance of more then £1,000 is nearly two and a half times the rate for those with less than £1.5,000.
“The majority of borrowers have experienced financial distress, with many having been forced to make difficult financial decisions due to the financial strain of debt,” Mr Hargres said.
The NSPRA said borrowers with student loan debt were often told that if they did not repay their loans, they could lose access to their loans. “
This has led to many borrowers not paying their debts and, as a result, many students who have paid their debt are not able to repay their loan.”
The NSPRA said borrowers with student loan debt were often told that if they did not repay their loans, they could lose access to their loans.
However, the report found that borrowers who default did not have to pay their debts, with nearly a third of borrowers not having to pay anything for the past six months.
“Even if you’re struggling to make ends meet, you can still access your loans in some form or another,” Mr Hargres said of the report’s findings.
“You can still have access to your loan if you do manage to make payments on it.”
The survey also found more than 70 per cent student loan borrowers who were in arres were also in debt.
A further 19 per cent were in a disability support pension.
The survey found that the majority (62 per cent) of student loan defaults were on student loans with higher repayments, and students who default on student loan debts have higher debt levels than those without debt.
The study found that of those with debt, 35 per cent owed more than their average income and 13 per cent owe more than five times the amount they had in their last three years of education.
Student loans have become increasingly popular among students, with about a quarter of students taking out a loan in the last 12 months.
While many of these borrowers are aged 25-34, the average debt level was about £1.,500.
The majority of loans had a loan-to-income ratio of 25 per in the survey.
Mr Henson said that in the long term, the problem was not simply student debt.
“We’ve got to start recognising that the problems with student debts are really generational.
It’s not something that we can simply ignore, and we can’t just ignore the fact that we’ve got a cohort of young people who are at the beginning of their careers, who have very low levels of employment and that means that we’re going to have to deal with a generation of people that has never been in this position,” he said.