How do i get an educational loan?

It is every parent’s dream to give their children the best quality education available. However, the cost of education seems to be ever-increasing. Parents find it quite difficult to meet all the amount required to send their children for higher studies in recognised institutions within India and abroad.

Most of the parents try to meet the amount required by taking a loan. Banks and other financial institutions provide loan against gold if you have gold in the form of jewelry, coins or other articles that can be kept as collateral security.

The gold loan interest rate is quite low and these loans are quickly sanctioned. However, these amounts are not always sufficient to meet the entire costs of higher education most of the time.

The best way to meet the educational costs of students is to apply for an educational loan. There are several banks and NBFCs within India that provide educational loans at reasonable interest rates. 

Educational Loans In India

The educational loans in India come with flexible tenures. The maximum loan period allowed by banks and NBFCs is usually up to 15 years. To get a maximum amount the loan needs to be secured. The average rate of interest for educational loans can be anywhere between 8.45%- 15.2% per annum. 

Different Types Of Educational Loans

Educational loans can be classified into two:

  1. Loans Based On The Type Of Course
  • Undergraduate course loans
  • Graduate course loans
  • Post-graduate course loans
  • Professional/Career oriented course loans
  1. Institution Within India Or Abroad
  • Domestic loans
  • Study abroad loans

Are Educational Loans Secured Or Unsecured?

Based on the policies of the particular bank/NBFC that provides the loan, an educational loan can be both secured and unsecured. Banks usually do not require collateral security for smaller amounts. If the applicant is looking for a loan amount higher than the limit set by the lender he/she will have to provide collateral security.

Criteria For Eligibility

The following are some of the criteria to qualify for an educational loan.

  • Applicant should be a resident of India
  • An admission within India or abroad for a recognised course
  • The course should be in a recognised College/University/Educational Institute in India/Abroad.
  • A valid Indian passport for applicants who wish to pursue a course abroad
  • Collateral security provided should be enforceable in India
  • Age limit (on an average): 
  1. Undergraduate course (18 years-27 years)
  2. Post Graduate courses (21 years- 35 years)
  3. Doctoral/Post-Doctoral courses (27 years – 65 years)

Documents Required

The following documents need to be submitted at the bank/NBFC while applying for an educational loan.

  • A loan application form that is duly filled and signed
  • Passport size photograph of the loan applicant
  • Proof of admission in a recognised institute
  • Proof of educational qualification (Mark lists of the student beginning from the 10th standard)
  • Proof of Income of parents/guarantor ( a valid bank statement of up to 6 months, Income Tax returns, Salary/Income details)
  • Proof of Address (Election ID card, Aadhaar card, Driver’s License)
  • Proof of age and identity (Election ID Card, Driver’s license, Passport, etc.)
  • Valid visa and passport for pursuing a course abroad

Once you’ve secured admission for a course in a recognised college/University within India or abroad you can think of applying for an educational loan to meet all the necessary costs. Keep all the above mentioned documents ready to make the application process simple and quick. Compare the loan amounts, rate of interest and tenure period offered by the different banks, NBFC’s and other financial institutions choose one that perfectly fits all your requirements.

This blog is maintained by the Finaura team. Finaura is a solution that will help you find the best gold loan solution from gold loan company nearest to you. If you have any queries please feel free to contact us. Call us on +91 484 2388285 or email us at [email protected]

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