Good afternoon,

 

On behalf of Jonathan Burrage, Manager Commissioner's
Correspondence, please find attached an acknowledgement of your Official
Information Act request.

 

 

Manager Commissioner's Correspondence

 

 

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Dear Mr Foote

 

Thank you for your request made under the Official Information Act 1982
(the Act), and received on 10 November 2017. You requested the following:

 

I am an Overseas Based Borrower (OBB) with a hefty student loan. I have
made multiple attempts at arranging a repayment program. At every avenue,
I have been told there is no provision for the interest to be halted. I
flew to NZ and had a face to face meeting with IRD and was told that
interest free deals cannot be offered due to legislation. I have since
discovered that many OBB’s have in fact been granted interest free
repayment plans.

 

Please tell me, how many Overseas Based Borrowers have been granted
interest free repayment plans?

 

Clarification requested

 

Can you please advise what you mean by ‘interest free repayment plans’?
Are you referring to loan interest or late payment interest?

 

By way of background, loan interest is charged on the overall loan
balance. There is no provision for loan interest to be remitted for an
overseas based borrower under the Student Loan Scheme Act 2011 (unless it
is reversed because it was incorrectly applied).

 

Sometimes borrowers living overseas can be deemed to be New Zealand-based
borrowers if they meet certain criteria. By being deemed New
Zealand-based, they will not be charged interest on their accounts. These
are borrowers such as those from realm countries (Nuie, Cook Islands,
Tonga , Tokelau), armed forces or some study situations. In order to be
deemed New Zealand-based, the borrower must adhere to stringent criteria
and all repayment obligations must still be met.

 

Late payment interest (formally late payment penalty) is charged on a
borrowers account when they have an amount overdue. Late payment interest
can be remitted in certain circumstances and Inland Revenue will often
negotiate full and final settlement payments based on a remission of
interest under “highest net revenue over time”. Late payment interest is
supressed while under an instalment arrangement if the payments are being
met each month. A penalty will be charged each time the instalment payment
is not met. After the third default, the arrangement will no longer be
valid.

 

 

If you could please clarify exactly what you mean by ‘interest free’ that
would be appreciated.

 

Cheers

 

Will

 

 

 

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Good morning

 

Please see attached a response to your recent Official Information Act
request.

 

 

Jonathan Burrage

Manager, Government & Executive Services

 

This email and any attachment may contain confidential information. If you
have received this email or any attachment in error, please delete the
email / attachment, and notify the sender. Please do not copy, disclose or
use the email, any attachment, or any information contained in them.
Consider the environment before deciding to print: avoid printing if you
can, or consider printing double-sided. Visit us online at ird.govt.nz