A third of uni students rely on debt to pay rent
As many as 60% borrow money from family, friends and employers, while 2% rely on payday loans, according to the research by money advice site Save the Student.
One student at the University of Leeds said she owed almost £3,000 on overdrafts, plus £800 on a credit card, just to cover the rent in her shared house.
According to the survey, students spend an average of £126.42 a week on rent or £547.82 a month.
However, a Freedom of Information request by Save the Student revealed that the average Maintenance Loan was £540 a month to cover both rent and living costs.
One in 10 students (11%) said rent was “a constant struggle”. A similar number (9.7%) have missed payments, while 2% have been evicted for not paying rent.
Jake Butler, money expert for Save the Student, said the survey highlights an urgent problem with student funding.
“This discovery that so many students are risking serious debt in order to just pay for student accommodation is worrying.
“It’s unfair that students are forced to borrow to keep a roof over their heads, and without being warned about the impact debt may have on their wellbeing and future finances. Students should be able to focus on studying, and not on trying to climb out of a debt spiral caused by shortsighted student funding and over-priced rents,” he said.
Sue Anderson, of debt charity StepChange, added: “Tuition fees and maintenance loans often won’t cover the essentials for many students, who can find themselves turning to consumer credit like overdrafts or private loans to survive.
“These forms of credit can seem attractive as they often won’t require repayment until the end of your studies. However, many students face a cliff-edge upon finishing university when repayments kick in and they are likely to be financially vulnerable.
“We’d encourage those lending to students to consider these pitfalls, and to ensure their products don’t end up causing financial difficulties.”
Applications for student finance for the 2020/21 academic year opened this week. The deadline to apply is 22 May for new students and 19 June for returning students.