How can I get Education LoanQuality education is significant for every student to lead a successful life. However, acquiring education at different levels has become difficult to afford due to the increasing fees every year, especially for higher education. The cost of education for engineering in India ranges between 5lakhs to 12lakhs, whereas medical courses soar high up to 50lakhs in private collegesand institutions.
To support higher studies, students have no option left except to apply for education loans in India. With so many banks offering education loans, it is confusing for parents and students to shortlist the best one. The interest rates for education loans in India vary according to the banks and financial institutions. However, the interest ranges between 12.00 % and 16.00 %, which depends on the bank’s base lending rate.
Here are a few tips before you apply for an education loan:
- Consider your financial capabilities before applying for an education loan, so that your name doesn’t appear in defaulters.
- Read the terms and conditions in the loan application form thoroughly before submitting
- Check for a lenderthat provides the flexibility of extending the repayment tenure
- Confirm in detail what all benefits the educational loan covers. Check for hidden fees or additional costs, if any.
An education loan covers full-time, part-time, vocational courses, and graduation/ post-graduation studies as well. Follow the procedure to avail education loan easily:
- Loan provider will verify the eligibility criteria considering your residential status, age, academic level, and income.
- Enter into a personal discussion with the lender to get clarity on aspects such as applicant’s academic performance, the course, the university or institute details, etc.
- Lenders demand the university/college/institute offer letter as a primary document for education loans.
- Add a guarantor – parent/guardians/self. Their credit score will be verified to ensure the loan repayment capability.
- In case the student is a primary applicant, the lender will request a promissory note of repayment.
- Finally, once all the requisites are submitted and verified, applicants will have to submit a post-dated cheque to initiate loan disbursal.
Education Loan Eligibility in India
High-grades, good academic record, and a strong financial background can improve your eligibility for education loan. The education loan eligibility criteria for Indian Nationals pursuing higher education in India or abroad requires:
- Confirmed admission letter in recognised educational institutes in India or abroad
- Loan applicant should be between an age group of 18 to 35 years
- Students applying for full-time courses should have a co-applicant - parent/guardian or spouse/parent-in-law (in case of married candidates)
- Duly filled and signed the application form, attested with two passport size photographs
- Copy of latest education certificate
- Proof/statement of course fees structure/travel and accommodation expenses, if applicable in case of students willing to study abroad
- Aadhaar Card and Pan Card of the Student and Parent/ Guardian
- Residence proof - Rental agreement/Electricity Bill of the student or co-borrower
- Income proof - Recent salary slips or Form 16/6 months bank statement of the parent/ guardian/co-borrower