5 Common Questions People Ask About Education Loans


Are you looking for an education loan? Read these popular questions people ask when they look for an education loan in India.

Higher studies cost has been rising continuously in India. The fee for multiple programs has increased upto 7-30% in the past decade, says this source. Top business schools in India have fees ranging from Rs 12 lacs to Rs 20 lacs. If the plan is to study abroad, you need to be prepared to spend more. For many Indian parents, it might not be possible to self-finance their children's higher education. It is where an education loan has a critical role to play.

The best part about getting an education loan for higher studies is that repayment starts a few months after the completion of studies. Once your children are done through with the course and get a job, they have enough resources in their hands to start making repayments. Make sure you use an education loan EMI calculator to have a fair idea about the amount of money you can borrow and how much money you will pay as EMIs.

Here is a brief understanding of some of the most common questions people ask about education loans:

1. What is the Education Loan Assessment Procedure?


The assessment for an education loan is no different from any other loan. The lending company first wants to make sure that they get their money back and are lending it to a credible person. You can have an estimate about your repayment amount using an education loan EMI calculator. This way, you know the amount you require and what amount you will have to repay and at what interest.

Most loan sanctions depend on but are not limited to various criteria like:
• Student's academic background
• Chosen college and course
• College's placement records
• Guarantors and Co-borrowers
• Co-applicants credit history
• Value and type of collateral if any
• Applicant's previous work experience, if any

2. What Documents Are Required for an Education Loan Application?


The list of documents required to process a loan application smoothly varies across lenders. Take a look at the list of documents that are commonly needed:
• KYC documents
• Academic track records
• Admission letter
• Expenses schedule
• Income proof of guarantor and co-applicants (Form 16)
• Income Tax Returns for all co-applicants and guarantor (Past 2-3 years)
• Bank Account Statements of all co-applicants
Make sure you collect the checklist of all documents from your elected lenders and submit the documents accordingly.

3. Which Expenses Get Covered under an Education Loan?


Every bank that provides an education loan covers different expenses related to your course. Most loans typically include fees like tuition, hostel, library and examination. Purchase of equipment, books and laptops may also be covered. In some cases, an education loan also includes the expense of student exchange programs. Thoroughly check the expenses covered and use the education loan EMI calculator to match your requirements to the education loan eligibility.

4. What is the Rate of Interest Charged for An Education Loan?


Different financial institutions charge different interest rates on education loans. These interest rates pre-dominantly depend on:
• Selected College
• Loan Amount
• Collaterals presented if any
• Prior work experience if any
Everything that the bank or NBFC uses during your loan application assessment plays an essential part in deciding the interest rate. While you compare different loan offers, use an online education loan EMI calculator to choose the best loan option.

5. How does the Repayment Schedule Work?


Since it is an education loan, banks or other financial institutions don't really expect the applicant to make repayments for the loan during the course of the program. Generally, all education loans offer a moratorium period when there is no need to pay anything to the bank. The repayment usually starts six to twelve months after the course completion. You can take advantage of the education loan EMI calculators available online to plan for the repayment of the loan. If you have a source of income like dividends or rental income, you can also opt for a loan without any moratorium period.
Choose Your Lending Partner Carefully
Do comprehensive research online before applying for an education loan. Find out the eligibility criteria and use the education loan EMI calculator to compare the loan terms offered by different banks.

Many banking institutions like Axis Bank provide education loans to help you finance the education that your children deserve. They provide you with the facility of an online education loan EMI calculator to promote transparency and many exclusive benefits. You follow your dreams while your banking partners take care of the rest.


Article by Tony John
Tony John is a professional blogger from India, who started his first Weblog in 1998 at Tripod.com. Tony switched to blogging as a passion blended business in the year 2000 and currently operates several popular web properties including IndiaStudyChannel.com, Techulator.com, dotnetspider.com and many more.

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Comments

Author: Sharada29 Jan 2020 Member Level: Gold   Points : 3

Age limit:- There is no age limit criteria to avail education loan for higher studies but the co-applicant or the guarantor's age should be more than 21 years. If the applicant had completed his degree, master degree or any other course and is interested to go for higher studies after a short time gap, he is eligible to take up higher education and avail loan.



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