To overcome the financial expenses for management studies (MBA) many nationalized and private banks offer various types of education loans. It is not easy to figure out the best scheme among so many options, hence here are few tips you need to follow and confirm before you sign for an education loan.
The following steps shall be very useful when you plan for an Education Loan :
- Understand the Loan
- Be confident for targeted college
- First exhaust all of your other resources
- Consider the advantages and disadvantages of the particular loan
- Study all the available options
- confirm about the grace period
- Pick up the right repayment option if available
- Know the repayment process
- Be sure about work-outs and cancellations
- Be aware of Pre-payment fees of loan
- Ask questions and clear all your doubts on the spot
The maximum amount of educational loan provided for studying in India is around 10 lakhs to 15 lakhs and for education through foreign universities, banks provide up to 20 lakhs.
The eligibility criteria include Indian Nationality, age, course period etc.. The age limit for students is between 16 to 35 years.
Guarantor or Security : A third party guarantor or security amout is required depending on the loan amount. A co-applicant is the third party guarantor such as parent, spouse, siblings, in-laws or any other close relative. Loans below Rs 4 lakh do not require a security token, but for a loan amount more than Rs.4lakh, a bank would require a security token to the effort of the house property, deposits, and more....
Documents Required : A student will require to provide identity proof, age proof and address proof. He/she is also required to submit an admission letter with a fee structure. In case of foreign bound student, they need to submit Visa approval papers, travel papers, GMAT/ GRE scores etc...
Please Note :
- When you plan for education loan, try not to base your loan on just lower interests rates. Traditional banks may provide low interest loan but processing period could be long. But private institutes can make the loan available very quickly. Therefore, look for the banks which give you loan sanction letter before your visa approval. Otherwise, the whole purpose of taking a loan is of loss.
- Stay in contact with the bank- After borrowing the loan keep in touch with leading bank continuously. Always keep a track of paid amount and leftover amount. If you have opted for floating interest rates you should always be updated with current interest rate and ongoing trend of the Market.