A study loan is taken by a student to pay for higher education. It is the most feasible method to fund higher education as there is a hike in the costs of education every year. There has been a significant increase in the amount of study loan in India since 2005. An education loans provides financial assistance to students by financing the expenses incurred for admission in a reputed university or educational institute. Study loans in India not only covers college fees, course fees but also covers a lot of expenses like library fees, traveling expenses and dormitory charges. Unlike other loan education loans provide too much flexibility in the repayment options. There is a holiday period or moratorium period offered by the banks and the NBFCs. It means that the borrower can wait for the repayment till one year after the completion of the course or for six months after securing a job. This provision allows the student to settle down financially.
For availing a Educational Loan in India you need to have a confirmation letter from your university or college. Also you need to have the secondary certificate, and other educational certificates. Depending on the loan amount the bank or the financial institution will ask you for the collateral security. Education loans have high eligibility guidelines, simple documenting and has a very quick processing which makes study loans more popular amongst the students.
When you apply for a study loans in India it not only covers your educational expenses but you also get tax benefits which reduces the overall cost of the loan. Apart from loan amount the banks and the NBFCs offer special incentives and scholarships to the students which are beneficial for the borrowers. Some banks and the nonbanking financial institutions provide special concession to female students and minority students.
How can you maximize the benefits of the education loan?
As an education loan borrower you need to do detailed market research so that you get the best study loan with lowest interest rate and flexible repayment options.
Make a total cost of the loan that is required to complete the course which includes every single minor and major expenses of the education. Course fee , library fee, a new laptops , books , study and research material, project fees etc.
Decide the mode of repayment. Whether you want to opt for EMI, holiday period or moratorium period.
Do a proper research on study loans in India offered by various banks and the financial institutions. While sanctioning any loan these banks and the NBFCs have certain parameters at which the loans are availed. Go for the education loan which offers a good amount at a lower interest rate and is also offers good flexibility in repaying. Take into consideration the expenses that will be covered by the loan amount.
An education loan is the key to make your dreams turn into reality. Hence, it is necessary to make the most of the loan.