Education Loan is a great relief for students and parents who are wanting to pursue their higher studies but hesitating due to the financial constraints. Few common queries related to Education Loan are addressed here:
40 Lakhs in India
Education Loan is available for the students who wish to study in any part of India. The student has to register in the Jansamardh portal and while registering they will get an option to select 3 nearest banks.
The student can get upto 40 Lakh rupees to study in India. Those with an annual income less than 4.5 Lakhs will get government subsidy when they take up a loan upto 7.5 Lakhs. It does not require collateral.
The student should get a merit seat for a recognized course in a recognized college/institute. If the student has taken up a management seat then the entrance exam score will be considered. Students can take one more loan while maintaining another loan, i.e, the student who has taken a loan for a degree is eligible to take a loan again for PG.
1.5 Crore to study Abroad
Students are now eligible for 1.5 crore to study in foreign universities where no collateral is required for loans upto 7.5 Lakhs. But the CIBIL scores of the parents will be checked. The CIBIL score is a three digit number that indicates your credit worthiness and is also termed as the credit information reports.
By checking this score, the bank will understand whether the applicant is a regular loan repayment person or not. If there’s a problem with a CIBIL score then a third party will be appointed as a guarantor. The Guarantor must possess some sort of an asset.
For applicants who require more than 7.5 Lakh, a property such as a house or land must be provided as a security except agricultural land equivalent to the required amount. These schemes will vary from bank to bank.
Documents such as the Course opting to study, University, Scholarship received from there and fees per semester should be provided to the bank.
Interest and Processing fees
Interest rates vary from Bank to Bank. The interest rate in SBI is 9.55% for loans upto 7.5 Lakh and 0.5% interest discount will be available if the insurance provided by the bank is taken. Also for girls there will be a 0.5% discount. Some banks will require a guarantor for loans above Rs.4 Lakh. There is a processing fee for students opting to study abroad. Few banks will consider the repayment capacity of the Parents before sanctioning the loan.
Required Documents
The following documents are required for processing the loan:
- Proof of Admission
- College and Course approval documents
- KYC ID Proofs of Student and Parents are all required; Aadhar Card and Pan Card are mandatory.