How to pay off your state college credit

It gives an account of the mechanisms to pay the university credit of the state universities (Solidarity Fund).

What is college credit?
A benefit granted to students of the universities of the Council of Rectors to finance all or part of the annual fee for a degree. This loan is called the University Credit Solidarity Fund.

How many types of college credit are there?
Depending on the date the credit was granted, there are three types:

  • University Tax Credit: It is governed by DFL No. 4 of 1981. It was granted between 1981 and 1986 with an interest of 1% per year. It is readjusted in Monthly Tax Units (UTM) and is paid in 10 annual installments if the debt is less than 40 UTM, or in 15 annual installments if the debt is greater than 40 UTM.
  • University credit: it is governed by Law N ° 18,591 of 1987. It was granted between 1987 and 1993. It has a 1% annual interest and is readjusted in UTM, with a payment term not exceeding the number of years in which credit was obtained .
  • Rescheduled tax credit: Law N ° 19,083 was enacted in 1991, which allowed university tax credit debtors to reschedule their debt for a 10-year term with an annual payment limit of 5% of the debtor’s income, readjustment by UTM and an interest of 1% per year, with the possibility of paying less, increasing the debit balance, when your income is very low.
  • University Credit Solidarity Fund: corresponds to the current credit system, governed by Law No. 19,287 of 1994. It is expressed in UTM and has an annual interest of 2%. It must begin to pay after two years of graduation with a maximum of 5% of the debtor’s income, although it can be deferred if his income is less than 6 UTM. The amounts may also be modified if the debtor is married, under certain conditions.

When should I start paying off college credit?
After two years of having graduated from a career. If the student has not graduated and has not enrolled within a period of two consecutive years in a career at the universities of the Council of Rectors, she must begin to pay the credit.

Those who are studying a postgraduate degree may request to postpone the obligation to cancel the credit until after the studies are completed, provided that these do not exceed three years in the case of a master’s degree and four in the case of a doctorate.

Where do I pay?
In the house of studies that granted you the loan, a discount per payroll can be agreed with the employers.

How can I pay?
There are three payment methods:

  • Cash payment: it can be paid at any time since the debt becomes enforceable, however if you do it at the beginning of the collection (two years after graduation or before) you can obtain a maximum discount of 25% of the total debt. This discount is determined by the administrator of the university credit solidarity fund, and must not impair the fund’s equity.

    Also, if during the collection you decide to cancel more than the annual amount calculated (5% of your income), a proportional discount of 2.5% will be applied for each tenth of the debit balance.

  • Payment in variable installments: corresponds to 5% of the income obtained the previous year. The debtor must prove his income with an affidavit and documents that he must present before the last business day of May of each year at the institution that granted him the loan.

    If, once the collection has started, you did not complete the process to prove your income before the last business day of May of the current year, a fee equivalent to the highest value between double the previous annual payment and 20% will be set. of the debit balance, payable as of December 31 of the respective year. If the following year you do not make the income statement, you must pay 40% of the debt. If the third year does not complete the procedure, you must pay the remaining 40%. In other words, the initial term of 12 or 15 years is reduced to three.

  • Payment in fixed installments: consists of the debtor subscribing a new instrument (debt renewal) for the total credit that can be paid in annual, equal and successive installments (maximum 10) that will accrue an interest of 4% per year and will expire on December 30 of each year.

Is there an alternative to monetary payment?
Yes. Law No. 20,330 establishes that it is possible to reduce the amount of debt by working for municipalities with a lower level of development in the country or for corporations and foundations that provide support to those municipalities.

For each year of service provided, with a maximum of three years, a benefit of an amount equivalent to the value of the annual installment of the credit that would correspond to pay during said year, or an amount equivalent to the amount paid for the credit in the previous calendar year, as applicable. This benefit also has a limit of 16 UTM, calculated with the December figure of each year.

In addition, for the third year of uninterrupted service, an additional benefit may be accessed for an amount equivalent to three times the value of the annual installment of the credit that would correspond to pay during said year, or three times the amount paid for the credit. during the preceding calendar year, as applicable. This benefit is also limited to 48 UTM, calculated with the December figure of each year. See additional requirements .

What happens if I am delinquent in the payment of the solidarity loan?
If as of June 30, 2011 you are delinquent in this type of credit (or in its previous version: the University Credit) and you have never reprogrammed it, you can benefit from the reprogramming established by Law No. 20,572. According to this rule, the creditor establishment must publish a list with the beneficiaries of the rescheduling and the deadline for them to reschedule. Those who must have previously registered with the credit administrator to qualify for the benefit. The balance of the debt must be paid in annual, equal and successive installments, with annual interest of 2%, which should not exceed 10 installments, if the amount of the rescheduled debt is equal to or less than 150 UTM, or 15 installments , if the amount of the rescheduled debt is greater than 150 UTM. It will also be possible for the debtor’s employer to deduct the fees from their remuneration, and for the SII to deduct the unpaid amounts from the annual income tax refund. The law also provides benefits, such as discounts on criminal interest if 50% of the balance is paid in advance.

What happens if I don’t pay?
The General Treasury of the Republic is empowered to withhold all or part of the return of annual income taxes to delinquent debtors.
The withholding will correspond to the total debt. That is, if you receive $ 100,000 (one hundred thousand pesos) in return and you owe $ 20,000 (twenty thousand pesos), the $ 20 thousand will be withheld. If instead, you receive $ 100,000 (one hundred thousand pesos) and owe $ 200,000 (two hundred thousand pesos), they will withhold those $ 100,000 and you will continue to owe $ 100,000.

The debtor will be notified of his situation by registered letter or, if he has no known address, by notice in the press. From that moment, you will have ten business days to appeal to the university that granted you the loan, in case the amount of the debt attributed to you is incorrect or if a mechanism that canceled it started to operate.

What if I am unemployed?
You will not cancel 5% of the year you did not earn income. To do this, you must prove your unemployment status by means of documentation, such as an income certificate from the Internal Revenue Service ( SII ), which you must attach to the affidavit that you must submit before May 30 of each year.
If during that time you have delivered tickets for services to third parties, you must cancel 5% of those income.

Can you forgive me the debt?
There are four conditions by which the debt can be forgiven:
After 12 years, if you have fulfilled all your obligations with the debt, that is, you have canceled or credited unemployment year after year, the balance of the debt, if it is less than 200 UTM, it will be forgiven. If the remaining debt is more than 200 UTM ($ 6,500,000), the term will be extended to 15 years. If after 15 years there is any remainder to be canceled, it will be forgiven.

Another cause for forgiveness is physical or mental incapacity to work, which must be accredited by the Commission for Preventive Medicine and Disability corresponding to your address.

The children of civilians or persons belonging to the Armed Forces and of Order who lost their lives for political reasons prior to March 11, 1990, will have their debt forgiven in accordance with Law No. 19,123.

 

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