Education loan for abroad studies: Everything you need to know | Forum

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soujanya Dec 28 '20

Education loans are a saviour for students who want to complete their education or pursue higher studies but who do not have enough financial support to do so. Financial lenders in India provide education loans for abroad studiesin India as well as overseas.

Benefits of applying for an education loan:

  1. Easily available

  2. Repayment tenure usually starts 6 months after course completion

  3. Entire education-related expense coverage – tuition fee, admission fee, living expenses etc.

  4. Available for a wide range of courses.

  5. Income tax benefits can be claimed-

Interest rate- education loan for abroad studies

It is the cost of borrowing money, expressed as a percentage of the loan’s principal amount. Different banks charge different interest rates on education loan for studies abroad. 

Processing fee- education loan for abroad studies

Banks charge an application processing fee which is at times refundable, depending on the bank you will avail a loan from. It is between INR 5000 to INR 10,000 for public and private banks but for NBFCs, it is usually 1% to 1.5% of the loan amount.

Procedure- education loan in indiafor abroad studies

Depending on collateral education loanfor abroad studies and  education loan without collateral, the procedure varies slightly.

Procedure for collateral-based education loan for abroad studies:

  1. Fill the online application form

  2. WeMakeScholars provides the list of documents and connects you with the nearest bank branch.

  3. Go to the bank branch with required documents and acquire details of the lawyer and valuator.

  4. Obtain Legal Opinion from the lawyer and Valuation report from valuator

  5. The lawyer and the valuator will submit the reports to the bank branch

  6. Complete documents are sent to RACPC or RBO.

  7. Processing officer verifies the application and sanctions the loan.

  8. After the loan is sanctioned, you will be required to sign the documents.

  9. Post visa approval, student visits the bank and completes the property mortgage process (Students prefer to complete this process after visa approval in order to avoid risk.)

  10. Disbursement agreement is signed and disbursement of loan amount takes place.

Documents required- education loan for abroad studies

This is a list of the documents required for education loan by banksfor abroad studies:

  1. Filled Application Form

  2. Photos – Applicant and Co-Applicant

  3. Photo ID (Applicant and Co-Applicant)- Provide any one of the following

  4. PAN card, Aadhaar card, Driving license, Passport or voter’s ID

  5. Proof of Residence

  6. Proof of Admission to a university

  7. Documents related to your Academics

  8. Financial statement

  9. Co-Applicant’s Income Proof

  10. Immovable Property Documentation, if the collateral is needed