Students should not think that they can avoid paying off their student loan by declaring themselves bankrupt, a new report has claimed.
The Guardian newspaper reported that one of the most commonly repeated myths about student finances is that people can escape their student loan by declaring themselves bankrupt.
However, the paper said that a rule change in 2004 meant that the student loan stayed with a person, even if they end up going bankrupt.
It added that, while the Student Loan Company had recently said that it would consider an application for an individual voluntary arrangement (IVA), it would generally turn it down unless the circumstances were "exceptional".
One expert, PricewaterhouseCoopers' Chris Turner, also told the paper that using a conventional loan to pay back student debt and then declaring bankruptcy was also not a good idea.
"I really wouldn't advise it - particularly if you plan to go into one of the professions, because you'll be finished before you've even started," he explained.
"If you have plans to go into the law, accountancy and the like, bankruptcy is not an option. If you're planning to be a potter its implications are less serious, but I still wouldn't advise it."
