After an arduous session of selection procedure many have finally managed to get admission to that foreign college/institute which they had been aiming for. But, aspirations of some have been held back due to high tuition fees. However, with an education loan, students can realize their dream of overseas education.
Getting an education loan is no longer a tedious job these days as it used to be. Almost all public and private banks offer education loan to students on easy repayment terms to fund their studies abroad. Here’s a brief checklist on getting an education loan.
Demand for an education loan is on an all time high these days. There is a huge requirement of loans for traditional Management and Engineering courses. Banks usually offer a loan of upto Rs 20 lakh for studying abroad. Students can avail loans for both undergraduate and post graduate courses and reduce the financial burden on their parents. In most cases education loans not only cover the tuition fees but also the expenses a student might incur for the course (travel expenses, hostel expenses, books etc).
Availing education loan is also not a tough job. One has to be an Indian national within the age group of 16-26 years to apply for the education loan. Once you get admission letter from a particular college/institute you can apply for the loan. After filling the loan application form, the student has to undergo a round of personal discussion whereby, questions relating to his/her academic performance, the course selected, etc are asked.
A guarantor is also necessary for education loans. Guarantor can be parents or guardians of the applicant. A guarantor’s bank history is thoroughly checked by the banks before sanctioning the loan to determine if they will be able to repay the loan if the need arise.
Also, by taking an education loan one can also get tax exemption. Students get a tax benefit on education loans under section 80(e) of the Income Tax act. A person can claim this benefit up to eight years after the repayment has started.
Education loans offer easy repayment terms to students. As long as you are studying you don’t have to worry about the repayment of loan. Repayment starts only after when a student is through with their course or starts working.
In most cases the repayment period starts only after six to twelve months after a student begins their working life. Some banks also give the option to students to repay the loan only after they secure a job.
Usually documents required for sanctioning of education loan varies from bank to bank. However, there are certain documents which almost all banks demand. Apart from your identity proof, address proof, and age proof, one needs to furnish the letter of admission from the concerned institute. Students are also required to submit their mark sheet of the last qualifying examination. Banks also demand details of assets and liabilities of the guarantor. Hence, if you have all the necessary documents in hand then in some cases your loan could even be sanctioned in less than seven days.