Something you must know before opting for Study Loans.

Something you must know before opting for Study Loans.

Many young students aspire to pursue their further education overseas. The only problem is the cost attached to such an education. That’s why education loans to study abroad are becoming more and more common. If you too are thinking of opting for an education loan to complete your studies abroad, then here are some things you need to know before you take out that loan!

 

1) Who provides these loans?

With their popularity rising exponentially, almost every bank and financial institute has added this service to their portfolio of financial instruments. As long as you have a good educational records and a confirmed seat at a recognized university, then both banks and private financial institutes will be glad to provide you with Study Loans.

 

2) What’s the amount you can avail?

If you’re looking to pursue an education in India, you can avail a maximum of 7.5 lakhs. But an educational loan will fetch upwards of 20 lakh! What’s more is that, if you put done some form of collateral like jewelry, property, bank fixed deposits, etc. then a bank or private financial institute will be more than happy to increase the borrowable amount.

3) What costs can you cover with Study Loans?

Your loan is the best tool to cover all the costs you incur whilst studying abroad. They are designed to cover essentials such as the institute’s tuition fees, examination or registration costs, library fees, your hostel or accommodation costs, the travel costs to and fro, the purchase of required book, apparatus, college uniforms, graduation regalia, etc.  Generally you can cover 80 to 90 percent of the total cost of an overseas education.

 

 

4) What is the rate of interest & when do I start repaying?

As compared to personal loans, Study Loans In India  invite a much lesser rate of interest. When you opt for an education loan, you can expect to pay anywhere between 12 to 13% percent interest rate. The exact interest rate will depend on your loan amount, the tenure, credit score, etc. Now coming to the repayment structure, the best thing about education loans is that you need not start paying back the loan as soon as you take it. Rather, they allow you a moratorium period wherein you don’t pay any EMIs during your course completion years or till you start working within a year, whichever is earlier. You can choose to pay amount within this period too, but check with your loan provider regarding pre-payment charges.

 

5) Are there any other fees involved?

Yes, like most loans, Study Loans  comes with a few additional costs such as processing fees, which will be up to 1% of the loan amount, pre-payment charges that will be up to 4% of the outstanding amount, late payment charges that will be pre-defined by the lender. So as to not be caught off-guard in regard to these expenses, it’s always wise to ask for a written list of all the charges involved.

6) What key documents are needed?

When applying for Study Loans, one would be required to furnish documents like a driver’s license, voter’s ID or PAN card for proof of identity. As far as proof of income is concerned, your parent’s salary slip or bank statement for the last 6 months would be required. Proof of address will also be required and can be satisfied with any utility bills. The admission letter will also be required along with all your past academic mark sheets and passing certificates.

 

 

These are just some of the things you must know about before opting for overseas education loan. But every bank or financial institute will have its own set of norms and procedures, speak to a loan advisor to know more.

All the best!