Education Loan starts at home and is a medium to open the doors of ignorance. The education loan process has to be limited to the concerned man who wants to know more. These days there is a smooth life and that is difficult. In case you earn a good amount after the month’s end then, the essential thing in your life will get ignored.
The process of education loan has become a real business and that means dreams for higher education would rely on our earnings. Different types of loans have been conceptualized. These loans have been carefully crafted keeping in mind the good prospects of higher education.
Rate of interest
There is marginal cost based lending rate that is 8.15 percent.
The documents required for education loan for salaried individuals are the passport, voter ID card, driving license, Pan Card, latest salary slip, bank account statement, latest electricity bill, latest mobile or telephone bill, bank statement or passbook of last six months, mark sheets of SSC, HSC, degree courses.
The documents needed for education loan for other individuals are proof of identity, passport, voter id card, driving license, pan card, proof of residence, bank account statement, latest electricity bill, latest mobile or telephone bill, bank statement or passbook of six months, copy of admission letter of the institute with the fees schedule, mark sheets or pass certificates of SSC, HSC and degree courses.
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Documents needed for the first disbursement
A demand letter from college or university, loan agreement signed by the applicant, sanction letter signed by the applicant, disbursement request form signed by the applicant, receipts of margin money paid to the college or university along with the bank statement that shows the transaction, documents for collateral security.
How to apply for an education loan?
Good quality education is the developing block to make the successful life for a student. With the increasing college fees each year, it becomes cumbersome for a student to have a good quality education. Education in India is quite costly. In case a student is qualified to get admission on merit, it is cumbersome to study in such institutions because of financial constraint.
Several parents believe that taking a personal loan for higher education proves to be of great benefit. This is not true. You may take a loan at a higher rate of interest and you will end up paying more. An education loan has several benefits and conveniences and is meant to be given for educational purposes which serves the purpose of the students.
The main determinants of the loan are the course fees to be pursued and the annual income of the applicant. There has to be a co-applicant which may be parents or siblings or the spouse.
The loans which are below Rs. 4 lacs do not need a guarantor or security.
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Important things to know about student loan
The interest rates for education loans differ in accordance with the banks. It can be between 2 percent and 16 percent and this depends on n the bank’s base lending rate and other aspects. The base lending rate for banks in India is around 9 to 10 percent.
You need to consider the financial capabilities and liabilities of your family and then choose an educational loan with the intention of repaying it on time. Education loans are like an investment. It has a low-interest rate. It is important that you study and know the conditions for applying in various banks prior to choosing the preferred bank.
If the bank is chosen, then you have to ensure that you go through all the terms and conditions and checklists of the loan application form as there can be some hidden expenses also.