Glossary

Adult Dependants' Grant

This money helps students who have an adult that is wholly or mainly financially dependent on them whilst studying. An adult dependant is someone who is dependent on the student rather than on the spouse or partner of the student, or on a third party. The person could be the student's spouse, civil partner or cohabiting partner, provided the student is over 25.

Annual statement

The Consumer Credit Act 1974 (CCA) requires Erudio Student Loans to send an annual statement to each customer which informs them of, amongst other things, the balance owing on their account at the end of the period to which the statement relates.

Arrears

An account is classified as in arrears if payments are missed or partly missed as they fall due. This can refer to one or multiple missed payments or partly missed payments. Accounts will remain in arrears until the shortfall is made up.

Attachment of benefits

Attachment of benefits is a method the Department of Work and Pensions (DWP) can use to enforce the payment of a debt. The DWP will deduct money from certain benefit payments and pay it to your creditor.

Attachment of earnings

Attachment of earnings is a method the courts can use to enforce repayment of a debt. The court will order that your employer deduct a proportion of your earnings and pay it to the court, the court will then send the money to your creditor.

Bankruptcy

Bankruptcy is a legal procedure where the courts can write off debt that you can't pay back in a reasonable amount of time. If you've got any assets they are likely to be sold to pay back your debt. Student loans are not normally included within a bankruptcy except in certain cases when the owner of the loan agrees to it.

Beneficiary

A beneficiary is someone who is or has received assets or profit from a trust, an estate or an insurance policy, when the conditions within the relevant contract are met.

Certificate of satisfaction

This is a document from the court certifying that money ordered by the court to be paid, has been paid.

Charge for payment (Scotland)

A charge for payment is a formal demand for payment of a debt following the issuance of a decree. It requires you to pay the debt in full within 14 days, failing which the creditor may proceed with further activity.

Charging order

A charging order secures a sum payable under an order of the court against certain types of assets you may own (such as land). If, for example, you have a county court judgment and you own a property or land your creditor could apply for a charging order over your property or land.

Child benefit

Child benefit is a regular (weekly or monthly) tax-free benefit payment made to anyone who is responsible for a child or young person. In most cases it is paid until the child is 19 as long as they are in full time education or training.

Child tax credit

Child tax credit is a means-tested benefit for parents and carers of children and young people. In most cases it is paid until the child is 19 as long as they are in full time education or training.

Childcare grant

This money helps with childcare costs for those with dependent children aged under 15 at the beginning of the academic year (or under 17 if they have special educational needs) and in registered or approved childcare.

Consumer Credit Act 1974 (CCA)

The CCA is an Act of Parliament which provides consumers with rights regarding credit related issues.

County court claim

A county court claim is a legal process your creditors can use to collect an outstanding debt.

County court judgment

A county court judgment is a court order that tells you what you must to pay towards a debt.

Credit file

A credit file is the information held by the Credit Reference Agencies (CRAs) about you. It contains information about your credit history, including payments of mortgages, credit card accounts, mobile phone contracts and utility bills etc. Your credit file may also include information about any types of credit you have applied for.

Credit rating

Your credit rating is the score a creditor allocates to you once they have assessed the risk of lending to you. Many creditors will use different information to assess the risk of lending to you and will score you differently. Your credit rating is determined by your credit file which is collated by the credit reference agencies.

Credit Reference Agencies (CRAs)

Credit Reference Agencies are companies that hold information about potential or current borrowers. This information is obtained from public sources (such as the electoral roll and court judgments) as well as from providers of credit (including banks, phone providers, utility providers, credit card companies and mortgage providers). Information collected includes: whether payments to other lenders have ever been missed; the amount the consumer already owes; and the amounts already repaid by the consumer. This information is then used by lenders to assess the risk of lending to a consumer.

There are three main CRAs in the UK. These are:
TransUnion
Experian
Equifax

Debt

A debt is an amount of money owed.

Debt advisor

A debt advisor is someone who works with you to evaluate your current circumstances and work out how to manage your debts.

Debt arrangement scheme (DAS) (Scotland only)

The DAS is a debt management tool introduced by the Scottish Government and accessed through an approved money advisor (see www.dasscotland.gov.uk). The DAS is designed to allow the repayment of multiple debts over an extended period of time.

Debt collection agency (DCA)

DCAs collect debts owed to creditors on behalf of those creditors.

Debt consolidation

Debt consolidation usually involves taking out a new loan and using the money to repay other debts.

Debt management plan (DMP)

A debt management plan is a plan under which you agree with your creditors, via a third party debt manager, to make an agreed regular sustainable payment amount towards your debt(s). It is a solution for people struggling to keep up with their contractual payments, but who still have money available to pay towards their arrears after all essential living expenses. The plan is arranged by a third party, such as the Step Change Debt Charity. They will contact your creditors with a proposed schedule of payments. If the creditors agree to the proposed schedule, you make one payment to the third party arranger every week or month, which ever appropriate, and they then allocate it between your creditors in accordance with the schedule of payments.

Debt payment programme (Scotland only)

A debt payment programme is the name given to the formal repayment programme provided under the DAS (www.dasscotland.gov.uk). A debt payment programme lets you repay your debts over a realistic amount of time without the threat of court action from your creditors.

Debtor

A debtor is someone who owes money.

Decree (Scotland)

A decree is a judgment or order, issued by the Scottish courts which orders you to pay a debt to a creditor.

Default Notice

A Default Notice generally follows letters already sent to you advising that your account is in arrears and asking for payment. The default notice will inform you of the action you are required to take to prevent termination of the agreement and a default being registered at the Credit Reference Agencies (CRAs).

Deferment

Under the terms of your student loan agreement(s), if your gross income for the relevant months falls below the current deferment threshold, as set by Government, you may apply to suspend payments under your loan for a period of 12 months (or 36 months if you can show that you receive a disability related benefit and your average gross income during the 36 months immediately following the relevant month will not or is unlikely to be more than the threshold set by the Government).

The Education (Student Loans) Regulations 1998 defines the deferment threshold as 85% of the lender's estimate of the average earnings of all full-time employees in Great Britain for the January when the level will apply. The Department for Education (DfE) make this calculation, which is based on figures published by the Office for National Statistics. The deferment threshold for the year from 1 September 2022 - 31 August 2023 is £2,924.33 per month (equivalent to £35,092 per year).

Diligence (Scotland)

Diligence is the term for debt enforcement.

Direct Debit

A Direct Debit is an instruction that you give to your bank or building society to pay a certain person or company each month. A Direct Debit instruction can be for a variable amount.

Disabled students' allowances

This money helps with extra costs a student might have as a direct result of their disability, long-term health condition, mental-health condition or specific learning difficulty such as dyslexia or dyspraxia. Disabled Students' Allowances are available to full and part-time undergraduate and postgraduate students. They do not have to be paid back.

Disposable Income

Disposable income is the amount of money which you have available to spend after you've paid for your household bills and essential living expenses.

Fair Processing Notice

This is sometimes known as a 'privacy notice' and is a legal notice which explains how someone's personal data will be processed. This includes how it will be obtained, used, recorded, shared and protected.

Financial Ombudsman Service (FOS)

The Financial Ombudsman Service is a free and independent authority whose role is to settle complaints between financial businesses and their customers. However, you must try to resolve the problem with the business first and it has eight weeks to get back to you. If you still aren't satisfied with its response or if you haven't received a response after the eight weeks, you can then complain to the FOS who will listen to both sides of the story and base a decision on the facts available.

I&E (Income and Expenditure Form)

An I&E form is a document that allows you to calculate any surplus funds you may have by recording your regular incomings and outgoings. This is a useful tool for budgeting and can be used by creditors to evaluate your affordability on any outstanding amounts. Third Party Debt Management companies may also ask you to complete an I&E in order to assess your current situation.

Income

Income is any money you receive, for example wages, pensions or benefits.

Income support

Income support is a means-tested benefit for people who are on a low income.

Individual Voluntary Arrangement (IVA)

This is a legally binding agreement between you and your creditors. In accordance with an IVA, you usually agree with your creditors to pay back an agreed proportion of your debts over a set amount of time.

To find out more, go to https://www.gov.uk/options-for-paying-off-your-debts/individual-voluntary-arrangements

Insolvency

Insolvency is a generic term used to refer to a number of legal processes and agreements, including bankruptcy, trust deeds and debt relief orders.

Insolvent

A person or a company is insolvent when they are unable to pay their debts as they fall due and any assets they own are worth less than the amount of money they owe.

Monthly Expenses

Monthly expenses are expenses you pay for each month. They include your household bills and payments of your debts.

Mortgage style loan

Mortgage style loans were available to eligible higher education students who started their course(s) between August 1990 and August 1998. These loans were not mortgages but were referred to as 'mortgage style' at the time because borrowers were required to repay in fixed monthly instalments for a period of 5 or 7 years. Repayments of these loans were collected directly by the Student Loans Company (SLC). Borrowers with a gross income of less than 85% of the gross average national earnings can apply to defer their repayments for a year at a time.

Notice of Assignment (NoA)

This is a document that is sent to a customer, as required by the Consumer Credit Act 1974, when their account is purchased by another creditor from the previous owner. The notice explains who owns the account, who to contact with queries about the account and may also explain how to make repayments.

Notice of Sums in Arrears (NoSiA)

This is a document that is sent to a customer, as required by the Consumer Credit Act 1974, when they are in arrears with repayments on their loan. Usually, this will occur if your account reaches two or more payments behind what you are supposed to pay.

You will receive further NoSiA letters every six months thereafter for as long as your account remains in arrears i.e. until the full amount of arrears has been repaid (including all interest and/or default sums), or until a judgment is made in relation to the sums payable under your agreement.

Original Creditor/Originator

An Original Creditor or Originator is a company or individual who lends money, or provides a service or goods for a fee. This includes banks, mobile phone providers and mail order companies. 

Payment Holiday

A Payment Holiday is where a creditor agrees that you can stop making payments of your debt for a fixed period of time.

Payment Plan

This is an informal plan agreed between an individual and a creditor directly and is often referred to as an 'arrangement to pay' or ATP. Here, an individual agrees to make sustainable, regular payment amounts towards their debt(s). It can be a solution for people struggling to keep up with their contractual payments, but who still have money available to pay towards their arrears after all essential living expenses have been taken into account. It is generally subject to an assessment of an individual's circumstances and affordability.

PPI (Payment Protection Insurance)

PPI or Payment Protection Insurance is a type of insurance that is sold alongside loans, credit cards or mortgages. It covers repayments for a set period of time if you can’t pay because of an accident, illness or unemployment.

Sequestration (Scotland)

Sequestration is the Scottish legal term for bankruptcy. It's the legal procedure to write off debt that you can't afford to pay back in a reasonable amount of time. If you've got any assets they will be sold to pay back your debt.

Statutory Demand

A Statutory Demand is a written request (in the form prescribed by law) from a creditor that demands you pay a debt within 21 days. If after 21 days the debt is not paid or set aside by the court, the creditor can start bankruptcy proceedings.

Student loan account number

The unique identification number attributed to a student loan customer account by Erudio Student Loans. You will usually be asked for this number when you call to speak about your account.

Student Loans Company (SLC)

A government owned organisation that provides loans and grants to students in further and higher education within the UK.

Subject Access Request

A Subject Access Request (SAR) is a request to a creditor from an individual for a copy of all information relating to their account. The creditor then has 40 days to supply the information. There is usually a £10 fee associated with a SAR.

Third Party Debt Manager

A Third Party Debt Manager helps individuals or households to manage their debts. The third party will contact your creditors on your behalf and arrange payments based on what you can afford. They will usually consolidate your payments into one monthly payment, meaning that you don't have to deal with multiple creditors.

Time Order

A Time Order is a court order which gives you more time to pay a debt if you've missed a payment. It can change the amount you have to pay each month or the term left on the credit agreement.

Working tax credit

This is a means-tested benefit for working people who are on a low income to help with everyday living costs.