With the recent advancements in the fields of education the cost of pursuing higher studies has been increasing every year. Higher education can be funded through using family savings, borrowing from friends and family, taking up a loan from the traditional finances. But it is always better to take an education loan for higher education as it particularly concentrates on the costs of education and the requirements of the materials to complete the course. In case of abroad studies, education loans are provided by the banks and the non-banking financial institutions.
The education loans are given at a lower interest rate of 12.75 % with a nominal processing fee of 1-2 %. This makes Education Loans more feasible and affordable than other sources of funding the education. By taking education loan you can reduce the financial burden off your parents considerably. Also students get a chance to take up their own financial responsibility. You get tax benefit under the section of 80 E Act of income tax of India.
Benefits of educational loan given by the banks and the non-banking financial institution:
An education loan will cover up financial costs for pursuing studies such as cover tuition fees, library fees, living costs, traveling and dorm charges.
Education loans have high flexibility in the repayment options that is you can opt for easy EMIs, moratorium period. There is no bulk payment which makes it more affordable.
Taking up a study loan will help you retain your family savings which can be helpful in the time of contingencies and calamities.
Timely repayment of the education loan will help you build up a good credit history. A positive credit history and it will help you avail loans in the future for setting up a business. You can avail a loan at attractive rates.
When you avail for an education loan you get attractive tax benefits. The whole interest amount has tax exemption without any upper limit. This feature is surely not to be missed.
When a student’s takes an education loan he or she values education even more. It helps him or her take a mature first step in taking up a financial responsibility. This will inculcate the value of money and the student will take up his loan seriously.
When you are taking up an education loan see to it that you take up grants, scholarships which are giving by the government of the host countries. You can also look up for a part time job this will help you reduce the burden off the loan considerably. By doing such you reduce the principal loan amount which you don’t have to repay. Before taking up a loan you should compare those online on the comparing websites. And apply for a loan that best suits you and your needs. You can even check the details about the loans by simply visiting the website. It better to compare loans in terms of interest rates, benefits, repayment strategies, processing fees and other tenure to clear of the debt.