Do you need an education loan to fund your studies abroad? This article tells you how to apply for a student loan and secure funding for your study abroad plans.
A hike in tuition fee here, a hike in tuition
fee there, and a hike in tuition fee everywhere! Every year as Unis around the
globe increase their tuition fees, you can’t help but cringe — given our
current exchange rate. But let that not demotivate you! When there are ways to
overcome these obstacles and live your study abroad dream, why stop now? What
you need to remember is that you are making a lifetime investment with your
study abroad experience. So let’s have a look at how to make your dream a reality
through the educational loan.
Source:http://www.hotcoursesabroad.com/india/fund-your-studies/how-to-get-education-loan-for-abroad-studies/
Now, don’t go dismissing the idea of applying
for an educational loan just because you nailed a scholarship. Sure, your
hard-earned scholarship will come to your rescue but it will most definitely
not cover the overall cost of your education abroad. So you most definitely
will have to consider applying for an educational loan. We know you feel
educational loans are complicated monsters, but we assure you they are nothing
to be scared of.
So wondering what kind of coverage the
education loan will offer? It will basically cover your tuition fees, book and
any supplies fees, room and board fees, transportation fees, health insurance
fees, and also your living expenses. It should take care of all your
education-related expenses. The bank won’t actually hand you the money but will
generally credit it into the Uni’s account at the start of each year or
semester as required. Interesting?
To help you get started, we want to spell it
all out for you — the basics of the educational loan…
1 2 3...Go!
Once you receive the offer letter from your
dream Uni, apply for an educational loan right away. To be able to do this, you
must research your loan options thoroughly during the lull after you’re done
with your Uni applications and are awaiting your offer letter anxiously. Make
use of this in-between time period effectively. This is definitely not the time
for you to take a break!
Interest to Compare!
As you run a research on loans
from leading banks, you will find that they offer loans with varying
rates of interest. We recommend you to take your time to compare the different
kind of loans that are on offer and run a thorough comparison. A helpful tip:
state-run banks have lower interest rates in comparison to private ones (if you
didn’t know that already).
Don’t set all your hopes on just one though —
we think it’s best for you to apply to multiple banks, in case your loan
application were to get rejected by one.
Let’s have a quick look at study abroad loan
details from some of our country’s top banks, shall we?
·
Bank of Baroda offers
loans of up to Rs 20 lakhs with a rate of interest per annum of 12% for loans
above Rs 4 lakhs.
·
Canara Bank offers up
to Rs 20 lakhs with a rate of interest per annum of 12% for loans between Rs 4
and 7.5 lakhs and 9.5% for loans greater than Rs 7.5 lakhs.
·
Axis Bank offers up to
Rs 20 lakhs and its rate of interest per annum ranges from 13.75% to 15.75%.
·
Credila (of the HDFC
Bank Company) offers up to Rs 20 lakhs and its rate of interest per annum is
13.5%.
·
ICICI Bank offers up
to Rs 20 lakhs and has an annual interest rate of 15%.
·
Indian Overseas Bank
offers up to Rs 40 lakhs and charges an annual interest rate of 15%.
·
State Bank of India
offers up to Rs 30 lakhs with an annual interest rate of 13.75% for amounts
between Rs 4 – 7.5 lakhs and 11.75% for amounts above Rs 7.5 lakhs.
For more details, approach the bank or visit
their website online. The current interest rates fall on an average between 11%
to 14%; however most of these are offered on a floating rate basis. In other
words, be prepared to face increased or decrease rates later. Be careful, you
don’t want the bank to spring any last-minute surprises on you, so read through
all related info with utmost care.
Eligible?
The first thing you should check as you begin
to shortlist banks is the eligibility criteria. Most banks offer educational
loans for long-term programs by reputed institutions. Short-term ones (such as
English language programs) are usually not covered. For those planning to study
vocational courses at a TAFE institution in Australia — educational loans don’t
cover these either. So be well read, it really helps to know all the teeny
weeny details here.
Your Cosigner!
In general, when your student loan exceeds Rs
5 lakhs, you will be required to have a cosigner. A cosigner is a person
(mostly a parent) who has to sign the loan with you, agreeing to pay your debt,
in case you fail to do so. Your cosigner will be on the hook for your debt and
so this is a very big commitment and not to be taken lightly.
Must-Know Loan Facts:
·
You will have to
provide the bank, margin money for student loans exceeding Rs 4 lakhs which is
usually 15% of the loan amount.
·
For student loans
about Rs 7.5 lakhs, you will generally have to offer the bank an LIC policy or
a few documents of immovable property in your name.
·
Be prepared for a
slightly lower loan amount at the time of disbursement, as it may be affected
by the exchange rate at the time of disbursement.
·
Your loan will have a
moratorium period or holiday period, only after which you will be required to
start with your EMIs. This period could last up to the duration of the course
or up to the time period till you find employment and varies from bank to bank.
·
Completing your KYC or
(Know Your Customer) is an important part of the loan-process.
·
This will help the
loan-provider feel assured that the student has the ability to repay and that
documents provided are accurate.
Be Ready!
Get in contact with the bank and obtain a
checklist from them beforehand to have all documents and papers ready and be
prepared for application. Also check to see if the Uni has any tie-ups with
banks for educational loans — if so, it could expedite the whole loan process.
Your Application Check List:
Run a check to see if you have these. You will
be needing some of these listed below.
Identity Proof:
·
Driving license
·
Passport
·
Pan card
·
Voter's identity card
·
A signed verification
letter from a recognized public authority or public servant for your identity
and residence.
·
Aadhar card
Address Proof:
·
Passport
·
Bank account statement
·
Ration card
·
Aadhar card
·
Voter’s ID card
·
Telephone bill/ water
bill/ electricity bill
·
Allotment letter
issued by a government department
Signature Proof:
·
The banker’s signature
verification
·
Driving license
·
PAN card
·
Passport copy
Know Your Clause!
We urge you to take your own time to really go
through the loan agreement’s fine print before you sign it. Keep your eyes open
— a few things you should be checking for include the interest structure,
pre-payment details, or if there is any option for you to extend it in case you
are unemployed after graduation. If you have any questions, you should get in
touch with the bank advisor. Be clear of the whole loan process and understand
its clauses.
These are just a few facts you should be aware
of, while approaching a bank for a loan. And that said, we hope you have a
better picture of how to secure a loan. Do you? Share your comments and views
with us! We would be happy to hear from you.
And also, if you are looking for any other
kind of assistance to get into your dream Uni, don’t hesitate to get in touch
with us. We, at Hotcourses India, would love to be of help!
Source:http://www.hotcoursesabroad.com/india/fund-your-studies/how-to-get-education-loan-for-abroad-studies/
Thanks for sharing on such foundations. Great work would like to know more on Education Loan For MBA
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