A guide to availing the education loan you need to graduate.
With more than 8500+ colleges & universities, the Indian educational landscape is evolving, resulting in the rise of new niche sectors such as vocational training, skill enhancement, and e-learning, to name a few. The rising willingness of the middle class to invest in education, as well as increasingly aggressive private-sector initiatives, are driving the growth.
Higher education equips you with new skills, a broad knowledge base and a wide range of abilities to help you navigate an increasingly complicated and interdependent world.
Education loans are used to pay for college costs and the loan process can be completed at any bank, non-banking financial companies (NBFC), or financial institution. Yes, you can easily get an education loan. It’s simple. It can be a good option for those aspirant students who want to accomplish their academic goals by pursuing higher education from a reputed university.
Purpose of education loan
Attending university may be the best decision for your career, but funding the education can be difficult to come by. If you don’t have enough financial aid to pay for your tuition and other costs, you should think about getting an education loan. However, before signing anything, you should look for the best education loan rates and additional benefits.
How to apply for education loan
Aspirants can apply for education loan either online or in-person at a branch. The online process is very easy. Follow the steps to apply today:
- Visit the chosen financial company’s website and fill out the application form
- Enter your personal information and property details
- Fill out your/co-borrower’s income details to access a personalised offer
- After you submit your information, an authorised person will contact you to provide you with additional loan processing instructions.
To approve the education loan, the lender will typically look at the following criteria. To apply for education loan, the applicant should:
- Be an Indian national
- Be of 18-35 year-year-old
- Be looking to pursue skill development courses in India or full time regular courses at Indian colleges/universities
- Have a good academic record
- Have secured admission in select premier institutions through entrance test/selection process
- Parent(s) must participate as a co-applicant.
- In case of a married person, co-applicant can be spouse/parent(s)/parent(s)-in-law.
- In cases where both the parents are not alive, a close relative or guardian will be considered as a co-applicant.
- Co-applicant must be an Indian national.
Many loan providers, including banks and non-banking financial institutions, offer education loans to individuals seeking specialisation and entry into the corporate sector. Working professionals can also use an education loan to improve their skills and advance in their careers. Numerous universities offer degrees and diplomas in a variety of courses and specialisations. Some of the courses covered are as follows:
Studies in India
- Graduation, post-graduation, and regular technical and professional degree/diploma courses are offered by colleges and institutions that have been accredited by the UGC/AICTE/IMC/Government, among others.
- Self-directed institutes like IIT, IIM, and others offer regular degree/diploma programmes.
- The Central or State Government must authorise teacher training/nursing courses.
- Aeronautical, pilot training, shipping, and other regular degree/diploma courses approved by the Director General of Civil Aviation/Shipping/concerned regulatory authority
Naturally, you would think your parents could pay for your education, however, for those who do not have that option, education loans are available! Traditionally, education in India covers the total tuition fee and some of the additional costs. Here are broad categories:
- 100% College tuition fees payable
- Accommodation charges
- Exam and library fees
- Books and equipment including a computer
- Traveling expenses abroad if any
- Other reasonable expenses required to complete the course
Types of education loans that can be taken
An education loan ensures that the university education is completed without financial difficulties. So, here are the two types that can help you decide which loan is right for you:
- Secured Loan: This is a loan in which the borrower pledges some of his assets as collateral. When a person obtains a secured loan, he or she must mortgage property to the bank or financial institution.
NOTE: The borrower’s mortgaged property cannot be agricultural land.
- Unsecured Loan: Unsecured loans are monetary loans that are not collateralised by the borrower’s assets. These may be offered by financial institutions under a variety of guises or marketing packages. A number of conditions must be met in order for this to happen.
What are the Documents required to avail an education loan?
Basic KYC documents, financial documents of borrower and co-borrower are required. At the time of application, the loan assistant will provide you with the specific requirements.
Education loan interest rate
The bank or non-banking financial institution charges a basic interest rate on the loan during the repayment period. Interest is decided by the lender. It once again depends on the course duration, loan amount opted for, CIBIL rating and repayment history.
Be ready to repay
When you have a loan in your name or the name of your parents, you must plan how you will repay the loan once you start earning.
Finding the best loan provider
Education loans are available from a variety of lenders but finding the best loan providers in India is a challenging task. It requires extensive study. Varthana can make this process easier for you by evaluating your profile and providing you with the loan you require.
Education can help you get a job at a reputed firm and even the university you attend can influence your ability to attract big firms to your application. Students who take out an education loan can be confident and do not hesitate to pursue their academic dreams.