Education loan for study abroad from Indian Bank for Indian students
The Indian Bank is a Public Sector Bank and it offers education loan to students for studies abroad. The education loan can be availed by any Indian student who has secured admission in a university overseas.
Studying abroad is no longer restricted to the children of the rich and the elite. Today, even the common man's child strives to get into a university overseas. The importance of good education from reputed foreign institutions is also not lost on parents. They leave no stone unturned to ensure that their offspring live their dream of studying abroad. The only hitch for the salaried and the middle-income group is the enormous rise in the cost of education abroad. However, despite the high costs, parents are generally willing to fund their children's education. They find recourse in education loans offered by the various financial institutions. Educational loans are definitely the most effective way for financing overseas education.
Today, most banks have dedicated loan schemes for education abroad, but public sector banks are the most trusted and reliable sources for such loans. The Indian Bank is one of the leading public sector banks that offers education loans for pursuing studies abroad. Being a government owned institution the borrower is assured of a competitive rate of interest and other benefits.
Education loan under the Indian Bank is categorised into different groups; one of which is exclusively for students keen on pursuing an education in a foreign institution. The loans provide funds to cover all requisite requirements for a student's stint abroad. These broadly include the course fee, living expenses and expenses for books and travel etcetera. Indian Bank education loan for study abroad
The Indian Bank offers a term loan to students wanting to pursue higher studies overseas. Here are the key points of the Indian Bank's student loan scheme for study abroad – Procedure for applying education loan from Indian Bank
Initial deposit
A paltry sum of ten thousand rupees is deposited with the bank at the time of applying for the loan. This amount gets adjusted towards the processing fee. If the applicant fails to avail the loan within four months of it being sanctioned the amount gets automatically appropriated by the bankExpenses covered
The loan amount covers all expenses pertaining to the study programme such as:Collateral security
It is mandatory for the parents or a guardian to be a co-borrower along with the student applying for the loan Additionally, a third party guarantee will also need to be furnished as collateral security. Parents and/or guardian can stand in place of collateral security if their gross annual income based on their Income Tax returns is three times the amount of the loan applied for. This means if the loan amount applied for is twenty-five lakhs the gross income of the co-borrower must be more than seventy lakhs per annum. A married applicant may use their partner or the parents or parents-in-law as the co-borrower. Margin money
Any loan upwards of four lakhs requires 15% margin money to be paid by the borrower. Margin money is 15% of the total amount of education. This means that the borrower pays 15% towards the cost of the education and the balance amount is funded by the bank. Another way of looking at is that the borrower pays 15% of the total loan amount and the bank covers the balance through the loan. Repayment period
The repayment period for the loan is between ten years and fifteen years, depending on the loan amount. Higher loans get a longer leeway for repayment.
There are two cut-off periods for the repayment schedule to kick in, depending on which of the two happens earlier –Who is eligible for the Indian Bank study abroad education loan
Any Indian national is eligible to apply for education loan for studies abroad offered by Indian Bank. The list of documents that need to be submitted along with the loan application are as under –Note:
Original copies of all documents will also have to be submitted to the bank for verification. Original property documents will be deposited with the bank.What can be offered as collateral
There is no collateral for loans less than four lakhs, but education loans for studies abroad generally go into tens of lakhs and require collateral. These are mortgaged to the bank for the term of the loan. Once the loan amount is repaid the collateral is transferred back to the co-borrower. Acceptable collateral security includes residential accommodation and securities etcetera.
All processing fees for the valuation of property, scrutiny of property documents by bank appointed advocate and registration of property at the registrar's office etcetera is to be borne by the co-borrower.
Once the paperwork is complete the bank initiates the legal procedures and the loan is granted. The money is usually paid directly into the university's account.Life insurance cover
Under the New IB Jeevan Vidya, a life insurance cover is made mandatory for students taking a loan for study in a foreign university. A one-time insurance premium has to be paid by the co-borrower.Rate of interest
The current rate of interest for education loans through the Indian Bank is 12.25% per annum. For more details log onto the Indian Bank Education Loan page or visit a branch of the bank nearest you. You can use the Indian Bank Branch locator to identify a branch.
If you want to scour through more student loan options then check the education loan schemes offered by these banks -