As we all know that quality education plays very important role in creating a successful life . But due to sky rocketing fee of college/Institution every year , it is very difficult for a student to take a quality education from a premier college/Institution . If a student qualify the entrance examination for taking admission in premier college/Institution but due to high tuition fee it is very difficult to study in such colleges/Institutions . Therefore education loan is a hopeful way for those students who can not afford such a hefty amount . On the basis of education loan facility provided by banks and NBFC student can fulfil his dream to study in premium college/Institution .
Now let me tell you how to get education loan :
#1. Eligibility Criteria :
- Application should be Indian resident having age lie between 16 years to 35 years .
- Should have confirmed admission in college , university recognised by UGC , AICTE
- Mostly available for Graduate , Post-graduate & diploma courses .
For education loan approval of applicants , co-applicant is mandatory .
#2. What is covered by Education Loan:
- Tuition fee of college/University
- Accomodation Charges of college
- Examination fee , Library fee
- Books & Equipments
If any applicant going to study abroad then travelling expenses are also covered .
Amount Sanctioned : The amount sanctioned if applicant study in India will be up to Rs. 15 lacs
For abroad , the sanctioned amount will be up to Rs. 75 lacs . But it all depends upon course , colleges & banks .
#3. Collateral / Security Required :
- Up to Rs. 4 lacs : No security is required .
- More than Rs. 4 lacs : parent to be joint borrower + Tangible collateral security . e.g Property , Fixed deposits , Life Insurance etc.
Moratorium Period: After how much time borrower will have to start paying loan . Moratorium Period will be Course period + Max. 1 year after course completion .
e.g. If a student doing B.Tech (4 year degree courses) then up to 4 years he has not to pay any amount because he is not able to pay during this period . One extra year is given to him so that so that during this period he will get the job and start repaying the loan amount .
#4. How much Margin Money :
- Up to Rs. 4 lacs – No margin money is required .
- More than Rs. 4 lacs – 5% will be margin money for studying in India
e.g. If college fee is Rs. 5 lacs then applicant would have to pay Rs. 25000/ and rest amount Rs. 475000/ would be paid by banks .
For study in abroad : 15% will be margin money
#5. Interest Rate :
As interest rate is not constant whereas it is variable and depends upon colleges , Courses etc.
(i) For Premier Institutions/Colleges , Interest rate is low . e.g. For IIMs/IITs/IISc interest rate is 8.25 % to 8.65 % .
(ii)For other Institutions / Colleges : Interest rate is 9.15% to 10.15%
(iii) For girls applicant there is a rebate of 0.5% on interest rate .
Note that Interest rate varies from bank to bank so please compare it before getting loan from any banks or NBFC.
#6. Tax Rebate & Disbursement :
- Avail Tax rebate up to 8 years under Income Tax Act .
- Applicant should know that loan is disbursed directly to college/Institutions .
#7. Documents Required :
- Application Form
- Admission Letter along with fee details of college / Institutions
- Aadhaar Card
- PAN Card
- Residence Proof
- Income Proof of Parent/Guarantor
- Passport / Visa if applicants are going to study abroad