Students starting degree courses this autumn can expect to graduate with average debts of £26,000. Due to the rise in tuition fees in 2012, this figure is expected to double for those beginning university next year. These figures have been announced as findings in the annual Push Student Debt survey. The figure for this year is likely to be £2,000 more per student when compared with those started their courses in 2010. For youngsters who are planning to go to university in 2012 the final figure could be as high as £53,400.
The survey calculated debt levels by adding up fee loans, bank accounts and credit cards debts, and money owed to parents and universities.
Johnny Rich, editor of Push.co.uk, commented that: "The government has failed to explain how debts of over £50,000 will not cripple graduates financially, particularly given that students will need to find a quarter of that money from outside the support of the official loans system."
This amount owed from outside the official loans system is worrying the National Union of Students (NUS), saying that leaving young people reliant on commercial credit just to stay in education is scandalous. The government points out that no first-time undergraduate will have to pay up-front costs, and graduates will make lower monthly repayments than they do now.
With the cost of living and having a good time, it is easy for students to build up debt, especially with banks and credit cards providing incentives. But it is important that students understand that before they head off on their adventures, they should know about the possible knock on effects of these debts.
Their credit report has already started. Once they have a current account or a mobile phone contract, their credit history is being recorded. Any debt built up or card payments missed will be marked on their report. Then when they leave university and want to buy a car on finance or apply for a mortgage, this past history may affect their chances of being accepted, or, even if accepted, could result in a higher interest rate.
Each application made for credit leaves what's known as a ‘footprint’
By checking your credit report, with http://www.creditratingmatters.co.uk - you can see what your credit history and rating is. You can also learn more about credit reports, and see what different elements are held in a credit report. Credit Rating Matters is a membership programme which provides access to a Callcredit credit report and credit score. These credit tools are provided by the credit reference agency Callcredit, and may provide an insight into anyone's financial positioning in the eyes of lenders.
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Credit Rating Matters is an online membership programme, which gives you access to your credit information held by one of the UK’s leading credit reference agency. Credit Rating Matters is a membership programme and monthly membership fees are payable after any free promotional free period has come to an end.