The Student Loan account

We will set up a loan account for you once your loan is approved. This is an account that keeps track of your transactions.

You need to take out a new loan each time you start a new course.

Each loan account closes on 31 December following your course end date. You can't use your loan once your loan account has closed.

After your loan account has closed, your loan balance will transfer to Inland Revenue on 28 February the following year.

Inland Revenue will be responsible for collecting repayments from you until your Student Loan is paid back.

You can have more than one loan account

In some cases you may have more than one loan account. If you are studying more than one course, and your second one starts before the other one finishes, you may have two loan accounts.

You'll need to sign a new loan contract (we'll send this to you) for each new loan you take out. An administration fee is charged for each loan account.

Student Loan administration fee

You'll need to pay a $50.00 administration fee every time you open a loan account.

The fee is added to your loan as soon as you use it. Once your loan is approved and your loan account opened, you will be able to use your loan.

How to check your loan balance

If your loan account is with StudyLink, you can get an up-to-date Student Loan balance online at MyStudyLink at any time. If you don't already have an online account call us on 0800 88 99 00.

Loan statements from StudyLink

StudyLink sends out Student Loan statements to borrowers three times a year.

You'll see that interest still shows on your Student Loan statement from StudyLink. Don't worry.

You'll get regular loan statements that show your transactions, interest charges and loan balance.

The final loan statement will be sent to you after your loan account has been closed.

It will show:

• your loan balance as at 31 December
• the interest charged
• all your transactions for the year
• the date your loan will transfer to Inland Revenue.

If you're eligible for an interest free Student Loan you don't need to do anything.

You are eligible for an interest free Student Loan unless you go overseas for more than six months.

Inland Revenue is the only organisation that can write off interest from Student Loans.

The interest will be written-off automatically after 31 March next year. This will show on statements Inland Revenue send you in May.

Loan repayments to StudyLink

Repayments to StudyLink can be made by cheque or by automatic payment.

If you would like to make payments by automatic payment call us 0800 88 99 00 and we will send you an automatic payment form.

If you are making repayments by cheque, please include your name, address, StudyLink client number, IRD number and a note saying the cheque is for your Student Loan.

Make your cheque payable to StudyLink and send it to:

StudyLink Centre
FreePost 113907
Private Bag 11070
Palmerston North 4442

Once your Student Loan is transferred to Inland Revenue your employer will pay your loan repayments directly to Inland Revenue. Any repayments you have made to Inland Revenue will show on your Inland Revenue loan statements.

You will be charged penalties if you don't make yoru repayments by the due date. Penalities are 1.5% per month on the outstanding balance (including penalities).

Interest free Student Loans

Any Student Loan borrower who has been in New Zealand for 183 or more consecutive days will be eligible for an interest free Student Loan.

Interest charged will still show on your StudyLink statements.

Interest will automatically be written off by Inland Revenue at the end of the year. Inland Revenue will send you a statement in May confirming that your interest has been written-off if you are eligible.

Interest is charged daily from the first day that you use your loan until you have repaid the loan in full.

The interest rate is 6.8% pa. It is made up of two parts:

• Interest adjustment rate - this is based on the movement in the consumer price index (cost of living) from the previous year. It can move up or down depending on inflation. It is currently 2.7%.
• Base interest rate - this is the difference between the interest adjustment rate and the total interest rate the government sets for each year. It is currently 4.1% pa.

Rates are reviewed on 1 April each year.

 If you have met the 183 day requirement your interest free write-off will be processed automatically.

• Your full interest write-off is processed automatically as long as you have given your IRD number to your education provider.
• Your interest write-off will be calculated in April 2008 if you study full-time for the full year in 2007.
• If you study part-time or part-year in 2007, your interest write-off will be calculated when Inland Revenue sends you a personal tax summary in July 2008 or when you file your IR3 tax return.
• Your interest write-off cannot be calculated any earlier.

What to do if you don't agree with your loan balance

While your loan is still with us, there's a standard process for disputing your loan balance. It's important you follow it so things can be sorted out as soon as possible.