The National Student Accomodation Survey 2020 found that a third of undergraduates are using loans, overdrafts and credit cards to pay rent at university.
The survey was conducted from December 2019 to January 2020, and 2,168 students in the UK were polled, with 1,563 of them being undergraduate students.
The survey also showed that 60% of these students were using monetary aid when sources include family, friends and employers. In addition to a third of the surveyed using credit to pay for their rent, 1 in 3 of the surveyed also feel their accommodation is poor value for the money they pay.
One person interviewed by SaveTheStudent said: “I owe almost £3,000 on overdrafts, plus £800 on a credit card (at around 30% interest). All of this was to pay rent in shared houses.
“I took a Smart-Pig loan for £200 to pay rent in my 2nd year. In the 3rd year I got a credit card, and put about £400 on it. Then I had to open a second overdraft.”
The survey has shown that students spend an average of £126.42 a week on rent, with the average Maintenance Loan award at just £540 a month for rent and living costs.
Jake Butler, money expert for Save the Student, a money advice site, said that the survey highlights the problem with student funding.
He adds: “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 overpriced rents.
The Maintenance Loan isn’t enough to live on and, evidently, most of it goes to landlords. The system is long overdue government[al] reform.”
In a poll we ran on instagram, we found that 89% of UEA students who commented say that they have not used any form of credit to pay for their rent and 11% of them have used a loan or credit to pay for their rent.
A UEA student, who has chosen to stay anonymous, responded said: “I maxed my credit limit to £3,000 across my second and third years at UEA. I also maxed my overdraft to £3,000.
“I understand that this paints a picture that I was careless with money but it’s quite the opposite as I received minimum student finance in my first year, which left me in a constant deficit despite working two jobs.
“Even when I was struggling, I could not ask for money from my parents as they were barely making enough to cover the cost of living, contrary to the belief that minimum loan meant you have rich parents.
“So, I have £6,000 of external debt despite working throughout my entire degree and living off of around £30 a week.”