Mortgage Industry News

← Back

Student debt 'similar to a cheap mortgage'

Date: Wed, 25 Jan 2006

A new study has concluded that student debt is unavoidable and represents a good investment similar to a cheap mortgage.

Unite’s 2006 Student Experience Report discovered that three in four UK students are in debt – with the average amount owned equalling around £5,267.

The survey found that 82 per cent of students have a student loan, whilst one in three have an overdraft and one in seven have debts with credit card providers. However, many people regard the student debt as a long-term investment along the lines of a mortgage – believing that the return on a university education will pay-off in the future.

"Students are finding ways to manage their money more carefully," said higher education minister Bill Rammell.

He added: "I am heartened to see that for the first time since the Student Experience Report was launched in 2001 students’ finances are improving. Both their levels of current debt and the money they anticipate owing on completion of their university course have declined."

Yet, one student in six is struggling in keep up with their monthly financial commitments and one in twenty may have already fallen behind – meaning their credit history could prevent them obtaining a cheap mortgage deal when they attempt to step on to the property ladder.


© 1998-2005 DeHavilland Information Services plc. All rights reserved.

Endsleigh Insurance Services Limited is authorised and regulated by the Financial Services Authority. This can be checked on the FSA Register by visiting its web site at www.fsa.gov.uk/register.
Endsleigh Insurance Services Limited. Company No: 856706 registered in England at Shurdington Road, Cheltenham Spa, Gloucestershire GL51 4UE.