Student loan company phone lines have been inundated with calls after a Martin Lewis video went viral, urging people to check if they could be owed “hundreds or thousands” back.
According to the Money Saving Expert founder, his recent Freedom of Information (FOI) request revealed over one million people overpaid their loans last year.
The video, which was shared on X, formerly known as Twitter, on Monday picked up more than 4,200 favourites, more than 800 re-posts, and 267 responses, which unsurprisingly led to a bombardment of the phone lines.
One user wrote: “Phone lines are inundated… I’ve been on hold for 50 mins.” Another followed up: “Can confirm! I’m currently at 58mins.”
Mr Lewis responded: “If you’re calling student loans company – worth knowing this, you can leave it a few days – I suspect this is my fault!!!” (sic)
Nevertheless, the long wait may pay off as many more shared their success stories. X user @sam_pn_spencer wrote: “An hour on the line but £700! Thank you Martin!!” (sic)
In the short video, Mr Lewis explained the ways in which a person may have unknowingly overpaid, as well as the ways to claim the money back. He used the current Plan Two threshold of £27,295 as an example of how to work it out.
If someone earned less than this amount during the 2021/22 tax year, which started on April 6, 2021, and ended on April 5, 2022, Mr Lewis said people may be able to claim, especially if they didn’t work a full year on the higher salary.
Mr Lewis said: “The big one – and the vast majority – is 833,000 people repaid, even though they don’t earn enough to repay. Now, you’ll know that you only repay your student loan if you earn over a set threshold.
“For most people, that threshold is just over £27,000, although depending on when you started university, in which UK nation, it might be over £22,000. But I’m going to stick with the £27,000 as the example.”
He continued: “Let’s take a twelfth of that (£27,295), the sort of monthly average amount, and you get to £2,274. So, because you pay this through the payroll, through PAYE (Pay-As-You-Earn), if you earn over £2,274 in a month, they take nine percent of whatever is above that to go towards your student loan.
“But now let’s imagine you only work six months of the year, or most months you earn below the £2,274, but you just got some bonus or you worked overtime. So a few months you weren’t above it.
“That may mean your student loan repayments were taken, even though in the tax year in total – April to April – you earned less than £27,295. If that happened, you repaid your student loan when you needn’t have done so. So, you are eligible to take that money back.”
Mr Lewis’s FOI also showed hundreds of thousands of students are also on the wrong student loan plan. He said: “The UK Government tells firms if they don’t know which plan you were on to default to ‘Plan One’, which is where you start repaying over £22,000.
“Yet millions of you, the majority, are on plans where you pay over £27,000. So, if you earn £24,000 and you were on the default, you would have repaid when you didn’t need to do so.”
Mr Lewis reposted his video again, saying: “I don’t think I’ve ever had as many quick success reports for anything as I’ve had for this, so many “I got £xxx” successes coming in. If you have left uni and have an outstanding loan this really is important to listen to.” (sic)
Anyone who thinks they may have overpaid their student loan can read the full guide on MSE.com here. Mr Lewis added: “If possible, gather your old payslips, your payroll number and a PAYE reference number, and you’ll have those when you get in touch either online or phone the SLC – (they would prefer it to be online – and you just tell them that you think you overpaid.”
If these details aren’t readily available, Mr Lewis suggested getting in touch with the student loan company regardless but warned that it will slow the refund process down.
People who think they may have overpaid their student loan can phone SAAS on 0300 100 0609, the Student Loans Company on 0300 100 0611, or visit GOV.UK.
