Pursuing higher education abroad can be a life-changing decision for most of you, however, this doesn’t come easy. Pursuing a full-time course from a foreign university comes with an exorbitant load of finances. Sometimes students find it difficult to arrange for funds to fulfil their educational expenses. In this blog, we will cover every aspect of student loans and how to get an education loan along with eligibility criteria and documents required for the same.
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Who Can Get an Education Loan
Any student may submit an application for an education loan with their parents or legal guardians as co-applicants. You must start making payments on your student loan within six months of obtaining work after your degree or one year after finishing your studies, whichever comes first.
Important Tips Before Applying For an Education Loan
- Any student who wishes to apply for an education loan must have their parents or legal guardians sign on as co-applicants. You must start paying back your student loan six months after you complete your degree or if you find work before that time, one year after you complete your studies, whichever comes first.
- You want to pick a bank that offers the option of extending the repayment period in case of delay due to unforeseeable situations.
- Students from the economically underprivileged sections of society should choose government-controlled banks since they provide advantages in the form of student interest subsidies.
- At the start of each semester, the loan amount is often disbursed directly to the school where you wish to apply. Therefore, it must include all of the advantages and services provided so that you do not have to pay any more fees.
Types of Education Loans
Education loan is taken by students to provide a range of services and continue their education with the least financial load. Before you move on to figure out how to get an education loan, take a look at some of the common types of education loans to study abroad:
- Bridge Loans: This pays for students’ pre-application expenses like application, examination, interview and student tours.
- Pre-Visa Loans: These are used as proof of funds availability for abroad loans and that students will not become a liability for the host nation for both accommodation and fees.
- Pre-admission Loans: This includes not only academic expenses but also, in-flight and overseas travel expenses and the cost of admission processes before the commencement of the higher studies.
- Refinancing Loans: These can be taken to repay the loans taken before and students can also choose to refinance to extend their loan tenure.
- Consolidated Loans: It covers a combined set of educational expenses including exams, tuition, books, educational equipment, travel, accommodation, deposits and insurance.
Eligibility Criteria for Education Loan
The process to get a loan is generally more tedious than the domestic one. Even though different banks may have their own set of requirements but some conditions remain the same for all courses. Based on the pattern followed by most of the banks, we have curated a list of eligibility standards:
- Applicants have to be a citizen of India. PIOs and NRIs can also apply for study loans in India.
- Acceptance/offer letter by the university or college that the student is going to join.
- Candidates should have their student VISA in place at the time of loan application.
- Applicants should also show financial viability to repay the study loan.
Apart from meeting the eligibility criteria, students must also know the documents required for an education loan. Knowing about what is required to apply for a study loan to study abroad, beforehand, is a smart move that can save a lot of your time later.
The question ‘how to get an education loan’ actually indicates that the person wants to know the procedure for the same. Let’s take a look at these:
- Select the bank and the loan scheme you want to take.
- After confirming both things, contact the bank to confirm the documents required to avail of the loan facility.
- After the submission of documents, the bank will evaluate your profile and sanction your loan accordingly.
While sanctioning loans to students planning to study abroad, banks usually check the kind of degree students are planning to pursue. Usually, courses which offer a good ROI like Engineering, Management or MBBS are preferred by banks for sanctioning loans. Here are some degrees and specialisations for which education loans are easily provided:
|Degree Levels||Undergraduate, Postgraduate, Doctoral and Diploma Courses|
|Courses||Computer Science Engineering, Mechanical Engineering, MBA, MBBA and other Engineering courses|
Top Education Loan Providers in India
Even though many student loan providers in the Indian market offer varied options to students, some banks stand out by providing the best facilities. A few of such banks are enlisted below.
- PNB Loan
- Syndicate Bank Education Loan
- Vijaya Bank Education Loan
- ICICI Loan
- IDBI Education Loan
- Bank of Baroda Education Loan
- Canara Bank Study Loan
- HDFC Education Loan
- Allahabad Bank Study Loan
Collateral for Education Loans
Another important aspect of getting a loan is the ‘collateral’, which are assets or guarantees that are to be submitted to the bank in exchange for the loan amount. Collaterals are not mandatory for smaller amounts of loans but are essential to get a higher amount of loans.
Also Read: Education Loan without Collateral
Documents Required to Apply for an Education Loan
Education loans are sanctioned to a candidate only after the submission of a long list of documents. Consequently, candidates need to get the list of documents required for an education loan right!
- Address proof.
- Identification card.
- Application form.
- Passport-size photographs.
- Admission Letter.
- Income proof of the guarantor.
- Collateral Security documents.
- GRE/IELTS/TOEFL/GMAT Score.
We hope that all your queries about the question of how to get an education loan for studying abroad are solved through this blog. If you require more extensive abroad admission support, like choosing the right university, identifying the suitable loan and creating the perfect application to target your dream universities, our counsellors at Leverage Edu can help you.