The expense of higher education is contacting the rooftop these days due to high expansion in education. It is hard for parents to support the education of their kid through their own pocket. On account of education loan that enables parents to finance the dream education for their children.
What is education loan?
Since the expense of expansion in education is a lot higher than the overall consumer price swelling, higher education is becoming costlier as time passes. In such a scenario it is very hard for parents to finance the education of their children. In this way, a large number of them have to resort to education loan.
Education loan can be taken either by the parents or the student or the spouse to finance higher education in India or abroad. It covers the expense of studies and other related expenses. Higher education here means education after higher senior secondary education. The measure of loan and other terms differ from lender to lender.
Education loan is the loan that can be taken by anyone to finance their child’s, spouses or own education. Education loan not just covers the education costs yet other expenses, for example, hostel fees, fixed expense and traveling expenses.
Benefits of applying for Education Loan online
- Easy examination You can easily compare the different alternatives based on interest rates, ban period, tenure and measure of loan which isn’t possible in offline mode. In the event that you need to apply offline, you should visit the branch of different banks that will require a great deal of time and effort.
- Saves you time and cost-Time has value. By applying online you save a great deal of time and effort in getting the loan.
Education Loan Eligibility
Education loan is the best method to pursue higher education in India and abroad without settling on your reserve funds or assets. Here the single amount sum borrowed from the lender is repaid in easy EMI after a half year of employment or course completion.
Eligibility for Education Loan
The eligibility for education loan differs from lender to lender and the criteria are set for both the candidate and co-candidate. However, the essential criteria are as per the following:
- You ought to be an Indian citizen
- You should fall in the age bracket defined by the respective bank
- You need to apply in a recognized college/establishment
- A decent academic record helps with snappy loan endorsement
- You need to apply for the education loan with a co-candidate who has a regular source of income
Education Loan Eligibility Calculator
Education loan eligibility calculator helps you get the estimation of the loan sum you can get from the bank or monetary establishment depending on your age and the co-candidate’s details.
This clearly states the eligibility criteria required for speedy and easy loan endorsement. You can likewise discover the amount EMI is to be paid at a given rate of interest and the tenure.
Education loan without collateral
As per the guidelines by RBI, an education loan of up to Rs. 4 lacs can be availed without accommodation of collateral yet when the loan sum exceeds the breaking point, you are required to submit collateral and an outsider guarantee is additionally required which, as a rule, is given by the parents of the student.
Now let us talk about the education loan eligibility criteria set by some mainstream banks-
Eligibility for Education Loan in Indian Bank
Indian Bank offers education loan for seeking after courses in India and abroad
- Student ought to be citizen of India.
- Also, he ought to have secured admission to professional or technical courses in India or abroad through an Entrance test or a merit based selection process.
Eligibility for Education Loan in HDFC Bank
HDFC Bank offers education loan of up to Rs. 7.5 Lakh with no collateral. It even provides wider collateral choices, for example, Residential Property, HDFC Bank Fixed Deposit, LIC, NSC or a KVP strategy. The greatest loan tenure is of 15 years post ban period.
The eligibility criteria includes-
- You need to be an Indian resident
- You ought to be aged between 16-35 years.
- In the event that you are taking a loan of more than Rs. 7.5 Lakh, a collateral security will be required.
- Co-candidate: A co-candidate is required for all full time programs. Co-candidate could be Parent/Guardian or Spouse (whenever married)/Parent-in-law (whenever married).
Eligibility for Education Loan in State Bank of India
- Ought to be an Indian national
- Ought to have secured admission to professional/Technical courses through Entrance test/selection process.
- Ought to have secured confirmation at reputed foreign university/Institution.
Eligibility criteria (For Studies in India)
Graduation/post-graduation/PhD and professional/Diploma/computer certificate courses of reputed foundations.
Eligibility criteria (For Studies abroad)
- Graduation: for work oriented professional/Technical courses by reputed universities,
- Post-graduation: MCA, MBA, MS etc.
Eligibility for Education Loan in ICICI
ICICI bank offers education loan for a large number of courses for graduate/post graduate degree and PG recognitions conducted by colleges/universities recognized by UGC/Govt. /AICTE/AIBMS/ICMR etc. Likewise, undergraduate, graduate and PG courses abroad are approved.
- The student ought to be an Indian National and more likely than not secured admission to professional/technical/Graduation/Post Graduation courses in India or Abroad through Entrance Test/Merit Based Selection process.
- Approval of loan will be considered based on academic record, net worth and income of family and scope for securing great/profitable employment. The student should present all required documentary evidences including receipts, estimates etc. and progress/performance report to the Bank regularly till completion of the course.
- In case of studies abroad, student ought to present the Unique Identification Number (UIN)/copy of Identity Card to the branch.
- The student/candidate ought not be profiting/won’t benefit any education loan when the loan is running. Necessary Affidavit/Undertaking to this effect to be obtained.
Education Loan Documents Required
Education loan is one of the easiest ways for students to subsidize their higher education in India or in a foreign nation. Competitive rates of interest are offered by banks and budgetary foundations to make higher education simpler for the students.
Banks have set Education Loan eligibility norms for the student also for the co-candidate. The student ought to be a citizen of India with great academic reputation and ought to have secured affirmation in a recognized University/College.
All loans require a co-candidate who needs to satisfy the fundamental requirements to apply for an education loan. The co-candidate could be a salaried or self-employed parent, relative or kin with a steady source of income. The age, yearly income, work experience in the current association, absolute work experience, educational capability and profession of the co-candidate are totally considered by banks before deciding on the loan sum.
In spite of the fact that every bank or money related foundation has its own rules regarding the documents to be submitted with an Education loan application structure, most banks may request the accompanying to be submitted.
Documents Required from Student
- Application structure (completely completed and signed)
- Two passport size photographs (both Applicant and Co-Applicant)
- Letter of affirmation from the Institute (on its letterhead with the address of the Institute)
- Cost break-up of the educational program from the Institute (specifying the education costs term-wise, year-wise and some other expenses involved)
- Academic record of the student:
- twelfth board mark sheet
- Certificates of subsequent years of education-graduation and post-graduation (assuming any)
- Imprint sheet of any entrance exam taken by the student (if applicable)
- Grant documents (assuming any)
- Sworn statement or Declaration that affirms that no loan has been availed from another bank or money related organization
- ID Proof (any of the accompanying) : Passport, PAN card, Voter’s ID card, Driving License, Aadhaar card, etc.
- Address Proof (any of the accompanying) : Driving license, Ration card, Voter’s ID card, Passport, Aadhaar card, etc.
- Age proof (any of the accompanying) : Birth certificate or Class tenth certificate
- Visa endorsement and travel papers
Documents Required from Co-candidate (if salaried):
- Address proof
- Identity proof
- Most recent 3 months pay slips or compensation certificate on employer’s letterhead
- Most recent 2 years Form 16 from employer or most recent 2 years Income Tax returns
- Some other income proof that isn’t reflected in the above mentioned documents
Documents Required from Co-Applicant if Self-employed (Professionals/Individual):
- Address proof
- Identity proof
- Most recent a half year bank statement
- Most recent 2 years Income Tax Returns
- Proof of office (any of the accompanying : lease deed, service bill, title deed)
- Some other income proof that isn’t reflected in the above mentioned documents
Education Loan Benefits
What are the benefits of taking an education loan?
Education loan not just helps you support your higher education yet additionally provides different other benefits. Read further to know how you can benefit from taking education loan.
- The assessee on whose name the education loan is taken can guarantee deduction for the entire interest some portion of the loan under Section 80E of Income Tax Act.
Be that as it may, on the off chance that you need to benefit the deduction, you have to satisfy the accompanying two conditions–
The loan more likely than not been taken from a specified money related foundation which includes banks and whatever other budgetary establishment which the Central Government may, by notification in the Official Gazette, specify in this behalf. In the event that you take educational loan from some other establishment, you won’t be able to get any assessment deduction.
It must be taken for higher education that is after breezing through senior secondary exam.
- The education loan not just covers the expense of the course yet nearly the entire expense of education. Majority of the banks generally support up to 90% of the expense of education. Following are the expenses that will be covered under the education loan-
- Education costs just as hostel expenses
- Exam, library, and lab fees if applicable
- Any refundable fees paid to the institute
- Cost of garbs, books and other essentials
- Traveling expenses
Generally banks offer 0.5% rebate on the education loan interest rate to female students seeking after higher education.
You get an occasion period known as the ban period under which you don’t have to repay the loan. This means the repayment does not begin immediately after the completion of the course. There is an occasion period of generally a half year to 1 year after which the EMI will begin. However, you have the alternative of serving the interest cost of the loan during the ban period. In the event that you do as such, the bank may consider reducing your interest rate by 1 percent.