Quick Answer: What Is Education Loan?

What is meant by educational loan?

An education loan is a sum of money borrowed to finance post-secondary education or higher education-related expenses. Education loans are intended to cover the cost of tuition, books and supplies, and living expenses while the borrower is in the process of pursuing a degree.

Is it good to take education loan?

Some students take an education loan for graduation and then avail of the top-up facility to complete their post-graduation. “ Taking a top up on education loan is bad, because it will increase the liability further. It is better to finish the first education loan before taking the second one,” says C. S.

How does education loan process work?

A collateral is asked for loan exceeding Rs 7.5 lakh. Once the loan application is accepted, the banks disburse the amount directly to the college/university as per the given fees structure. The banks uses the Marginal Cost of Funds based Lending Rate (MCLR), plus an additional spread to set an interest rate.

You might be interested:  Readers ask: What Does A Special Education Teacher Do?

What is the difference between student loan and education loan?

An education loan offers a lower interest rate as compared to a personal loan. If you are qualified for a government-subsidized loan, you will have to pay even lower interest rates. Education loan generally offers a longer repayment tenure that can go up to 20 years.

Is getting education loan easy?

Easily available: Education loans are widely and easily available. In fact, they are a priority product in all banks as per the RBI’s guidelines. Varied loan amounts: Banks can offer loans anywhere between Rs. 2 lakhs and Rs.

What all does education loan cover?

Your education loan will cover a number of things in addition to your tuition fees. These include hostel fees, exam fees, library fees, purchasing books, travel and other expenses for educational projects. Interest rates on educational loans depend on a number of factors.

Is education loan free of interest?

In most of the cases, it is just subsidized. However, you can still make your way around to avail education loan at 0 interest. There is no interest paid until then. This can be availed under the Central Sector Interest Subsidy Scheme and can be availed only from one of the scheduled banks.

How much percentage is required for education loan?

The bank filed the present appeal saying candidates who have secured 60% marks and above alone are eligible to get education loan as they alone can be treated as meritorious candidates.

What happens if education loan is not paid?

If you are unable to make repayment on your education loan, then you will receive notices and warnings from the lender. If you fail to comply with the same then the lender is legally entitled to the assets you mortgaged. Your property or asset can be auctioned or used by the lender.

You might be interested:  Often asked: What Are Qualified Education Expenses For Taxes?

Which bank provide education loan easily?

Axis Bank brings you Education Loans for studies both in India and abroad starting from Rs. 50,000 at attractive interest rates. With an Axis Bank Education Loan you can enjoy a host of benefits such as simple documentation, quick loan disbursal, tax benefit u/s 80(E), long repayment tenure, etc.

Is mortgage required for education loan?

However, you can get an education loan without pledging any security. There is no margin requirement if you apply for a loan within this limit through a scheduled commercial bank under the CGFSEL scheme. It means that the bank can finance up to 100 percent of the loan, if the loan is up to the limit of Rs 7.5 lakh.

What are the documents required for education loan?

Documents required for an Educational Loan:

  • Duly-filled application form.
  • 2 passport size photographs.
  • Graduation, Secondary School Certificate, or High School Certificate or mark sheets.
  • KYC documents that include ID, address, and age proof.
  • Signature Proof.
  • Income Proof of parents or guardian.

Can we take personal loan and education loan together?

No, you do not have to choose between the two loans. You can definitely apply for a personal loan even if you have an education loan that has been repaid completely. However, the personal loan interest rate will be higher than normal. The reason behind it is that education loans are considered very risky by lenders.

Leave a Reply

Your email address will not be published. Required fields are marked *