You are here: Home - Credit Cards & Loans - News -

A third of uni students rely on debt to pay rent

0
Written by:
18/02/2020
One in three undergraduates use loans, overdrafts and credit cards to pay rent at university, a survey has found.

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.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Could you save money with a social broadband tariff?

Two-thirds of low-income households are unaware they could be saving on broadband, according to Uswitch.

How to help others and donate to food banks this winter

This winter is expected to be the most challenging yet for the food bank network as soaring costs push more pe...

Your rights for refunds if travel is affected by strikes

There have been a wave of strikes this year across many different industries, and more are planned over Christ...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week