Closure of a loan account
A loan account is closed when all borrowing activity has ceased or when circumstances require it, including when a student:
- has completed all study included in that loan account and no more study will be added
- dies
- is adjudged bankrupt
- has engaged in proven fraud or other unacceptable behaviour
Once a loan account is closed it should not be accessed unless a correction is required to any transactions contained within it.
Death of a borrower
If a student dies before repaying their loan to Inland Revenue, the balance of the debt will generally be written off by Inland Revenue.
If a death certificate is available it should be obtained. If not, details of the date and place of death should be obtained.
The loan account will be closed and any details of the death MSD holds will be sent to Inland Revenue.
When a payment has been made from the loan account after the date of the death of a student, an MSD debt may be established for recovery from the student's estate.
Fee refunds
Any fee refunds due from a provider must be repaid to a student's loan account if they were paid from the student's loan account.
In the event of the death of a student, fee refunds must not be paid by the provider to the student's estate.
