Table of Contents
- Understanding Education Loans Options
- Education Loan Eligibility Criteria
- Common Eligibility Requirements
- Documents Needed to Apply for Student Loan Option
- Frequently Asked Questions
In today’s world, education can really change your life. Whether you want to get advanced degrees, special knowledge, or unique certificates, the journey through higher learning is like an exciting adventure. However, to pursue this dream, it can be very expensive and a lot of people may find it difficult.
That’s where education loans come in.
In this detailed guide, we’ll take a close look at the complicated world of education loans and who can get them. Imagine it like a map that will help you reach your study abroad goals. This guide is meant to help talented students like you get the money they need to go to international universities.
Understanding Education Loans Options
Education loan options are like financial companions designed to help students and their families cover the costs of advanced studies. These loan options step in to support expenses like tuition fees, textbooks, accommodation, and other educational needs. What makes them particularly appealing are their favorable features, including lower interest rates and adaptable repayment choices
Education Loan Eligibility Criteria
For Study abroad loan Options we have 3 categories:- INR Banks, UScosigner Banks and Non-Cosigner Banks
INR Banks
Note : The education loan eligibility criteria vary for different banks.
Loan Eligibility for NBFC Banks:-
Residency Requirement: You must be a resident of India to qualify for these bank loans
Work Experience: Possess at least one year of work experience to apply.
Age Requirement: An applicant must be at least 20 years of age
Fast Approval and Processing: Loans from these banks are approved and processed quickly.
Self Employment Option: If you work for yourself, you can apply if your income meets specific criteria set by the best loan provider in India.
Excellent Customer Service: These special banks are known for providing exceptional customer service during and after loan approval.
Minimal Documentation: Unlike traditional banks, as the entire process is online you won’t have to deal with lots of paperwork because
Easier Eligibility: These banks have less strict requirements and checks compared to traditional banks, making them a better choice in emergencies.
Loan Eligibility for Private Banks:-
Personal Details: Applicants should be Indian citizens who have completed 12th grade and secured confirmed admission to a recognized institute for a degree or diploma program
Documentary Requirements: Various documents are required alongside the loan application.
Co-applicant’s Details: Eligible co-applicants include parents, siblings, spouses, grandparents, and parents-in-law. They must have a steady income and provide appropriate income documentation.
Target Program: Loans are granted for job-oriented undergraduate and postgraduate degrees
Accepted Collateral: The bank accepts residential and commercial properties, agricultural plots, and fixed deposits as collateral.
Efficient Loan Approval: After all necessary documents are submitted, the bank processes and approves the loan within 7 working days.
Comprehensive Loan Coverage: Education loans cover all expenses related to studying abroad, and in exceptional cases, loans exceeding the standard limit may be approved.
Loan Eligibility for Public Banks:
Nationality Requirement: The applicant must hold Indian citizenship.
Underage Applicants: If the student applying for loan is below 18 years of age, their parents must act as their representatives when applying for the loan.
Academic Excellence: The applicant should have an outstanding academic track record.
Overseas Institution Acceptance: To be eligible, the applicant must secure admission to a prestigious international college, university, or institution.
Technical or Professional Courses: Banks are more inclined to support programs that equip students for professional careers, so the chosen course should be technical or professional.
Educational Goals: The applicant’s educational aim should be a graduate, postgraduate, or post-graduate qualification.
Academic Record’s Influence: A strong academic history expedites the loan approval process.
Full-Time Student Requirement: Co-applicants with a reliable source of income are required for full-time students, and these co-applicants can include parents, guardians, spouses, or in-laws (for married applicants)
Read Also:
- Documents Required for an Education Loan
- US Education Loan: Know all Details
- Education Loan for Abroad Studies
- Difference between NBFC and Banks
US cosigner Banks
Loan Eligibility For US cosigner Banks:-
Co-Signer Eligibility: The co-signer typically embodies U.S. Citizenship or holds the esteemed Permanent Resident Card, accompanied by a residency in the U.S. spanning a minimum of two years.
Responsibility Sharing: The co-signer will share equal responsibility for the loan options.
Repayment Assurance: In case of any default or late payment scenario, they will be the immediate person to repay the loan.
Income and Eligibility: Income should be substantial, and liabilities should be minimal to secure competitive rates.
Credit Score Requirement: A good credit score, typically above 650, is necessary.
Source of Earnings: There should be a source of earning and income.
Minimal Documentation: No documents are required from the co-signer.
No-cosigner Banks
Loan Eligibility for No-Cosigner Banks
- Credit History: Some lenders may require a strong credit history from the student borrower. This means having a good credit score and a positive credit record.
- Academic Enrollment: The student must be enrolled in an eligible educational institution abroad and pursuing a recognized course or degree program.
- Visa Status: Students must possess the necessary visa status to study in the host country.
- Income or Financial Stability: Some lenders may assess the student’s ability to repay the loan independently based on their income or financial stability.
- Loan Amount: The loan amount sought should align with the lender’s specified limits for non-cosigner loans.
Common Eligibility Requirements
- Eligibility for the loan options necessitates Indian residency as a prerequisite.
- Getting into a higher education program, whether it’s in India or abroad, often depends on passing entrance exams.
- Aspiring candidates must comfortably fit within a predefined age spectrum, generally spanning from 18 to 35 years, to fulfill the criteria for securing an education loan option.
- The chosen course of study should inherently bear a career-centric orientation to align with the loan prerequisites.
Documents Needed to Apply for Student Loan Option
Common Documents
- Photo ID
- Permanent Account Number (PAN) Card
- Passport
- Driving License
- Aadhaar Card
- Voter’s ID Card
- Residence Proof
Applicant and Co-Applicant (Any one of the following)
- Passport
- Driving License
- Aadhaar Card
- Voter’s ID Card
Academic Documents of Student
- Mark sheet/Certificate of 12th Exam
- Marksheet/Certificate of Subsequent Years of Education e.g. BE, BCom, BSc, etc.
- Marksheet of Any Entrance Exam Taken e.g. CAT, CET, etc. (If applicable)
- GRE/GMAT/TOEFL/IELTS, etc. Marksheets (If applicable)
- Scholarship Documents (if applicable)
In the case of Salaried Employee
- Latest 3 Salary Slips or Salary Certificate on Employer’s Letterhead
- Last 2 year’s Form 16 from Employer or Last 2 Year’s Income Tax Returns
- Any Other Income Proof That is Not Reflected in the Above Documents
In the case of Self Employed or Professional
- Last 2 Year’s Income Tax Returns
- Last 2 Year’s Certified Financial Statements or Provisional Financial Statements Duly Certified by CA
- Proof Of Office (any one of the following, Lease Deed, Utility Bill, Title Deed, etc.)
- Any Other Income Proof That is Not Reflected in the Above Documents
Collateral Documents
- Property Title Deed: Think of this as the birth certificate for your collateral property, a must for securing your education loan.
- Registered Sale Agreement/Gift Deed/Will: These documents clarify how you obtained the collateral property—whether through purchase, gift, or inheritance.
- Original Registration Receipt: It’s your official proof of registering the property agreement, showing that it’s on the books.
- Allotment Letter by Municipal Corporation: This letter confirms your property’s allocation by the city, a key piece in the collateral puzzle.
- Approved Building Plan or Plot Layout: Picture this as a blueprint of your collateral property, approved by the municipality and necessary for loan approval.
- Matching Electricity and Property Tax Bills: Ensure your bills bear the same address as your collateral property—it’s vital for verification.
- No Objection Certificates (NOCs): These certificates demonstrate that your collateral property is free from legal disputes, making it eligible for the mortgage
Know More: Documents Required for an Education Loan
Frequently Asked Questions
What are the requirements for the Study abroad loan option?
1. Must be a citizen of India
2. A parent or guardian must be present
3. A letter of acceptance from a reputable overseas university is required
4. For the loan to be disbursed, the borrower’s financial situation must be steady. Rewrite this in an uncommon way
Can I get an education loan without my parents?
Even if your parents don’t have significant financial resources, you lack valuable collateral to offer, or you don’t have a financially strong co-applicant, you may still be eligible for an education loan to support your studies.
What is the time period of a Study abroad loan?
Most government banks typically provide students with a repayment window lasting from 12 to 15 years, not including the moratorium period. However, if students have the means, they can settle their loans earlier than the stipulated duration.
How do I pay my education loan?
A highly effective way to pay off your education loan faster is to begin making payments during the moratorium period, which is the time when you’re not required to make payments. By reducing the initial loan amount during this period, you’ll be able to clear your loan earlier than the set duration.
Does a Study abroad loan have interest?
Banks decide how they charge interest on student loans. Some banks keep the interest rate the same throughout the repayment period (like a fixed rate). Others use a rate that can change based on something called the Lending Rate, which is influenced by the one-year Marginal Cost of Funds based Lending Rate (MCLR).
