Summary
In England, interest rates on certain student loans will be capped at 6% starting in the 2026-27 academic year. Different loan plans exist based on when and where students attended university, with Plan 2 loans being a common type for students since 2012. Student loans generally cover both tuition fees and maintenance costs, but maintenance loans often do not cover all living expenses.
Key Facts
- England will cap interest rates on some student loans at 6% for the 2026-27 academic year.
- The cap applies to Plan 2 loans and Plan 3 postgraduate loans.
- Graduates with Plan 2 loans repay 9% of earnings over a set threshold.
- The repayment threshold for Plan 2 loans will be frozen at £29,385 from 2027 to 2030.
- Plan 2 loans' interest rate relies on the Retail Prices Index (RPI) plus up to 3%.
- Plan 2 loans have now been replaced by Plan 5 loans in England.
- Maintenance loans vary across the UK and are based on household income.
- Some students were told they were “mis-sold” maintenance loans and must repay the funds.
