March 23, 2024
education loan

How Will A Study Abroad Education Loan Benefit You?

One of the first thing that comes to a study abroad aspirant’s mind is how to manage the education expenses. While arranging for funds the only two things that come to mind are Scholarships and Financial aids.

Although, the huge competition in international education makes scholarship extremely competitive and it is not always possible to secure such benefits. But that is not the case for Overseas Education Loan. In today’s date education loans have become an easier way to secure funds.

The below points will help you gain some understanding into why exactly you should consider applying for an education loan for studying abroad:

1. Education loan is one of the priority sectors under which banks are required to lend by the Reserve Bank of India.

2. Students applying for overseas education loan can easily avail tax benefits under section 80 (E) of Income Tax Act 1961. The important criteria of this Act are:

  1. Loan must be availed from an approved financial institution
  2. Loan must be for full-time overseas studies for diploma, graduate or postgraduate courses
  3. Deduction is permissible for a continual period of eight years
  4. The loans provided for study abroad education usually cover the below areas:

a) Institution Fee

b) Hostel Fee and Mess Expenses

c) Examination Fee

d) Library and Laboratory Fee

e) Purchase of Books

f)  Equipment and Instruments / Laptop

g) Caution or Refundable Deposit

h) Passage money to the host country

i)  Travelling Expenses / Air Tickets

j) Overseas Travel Insurance

4. Most of the banks provide an average of 10 to 15 years to repay the education loan.

5. The loan amount that is generally granted to a study abroad aspirant ranges from 20 to 40 lakh rupees. Although, this amount can vary on the higher side, basically if the student is applying for bachelors as the study duration is longer than masters. The student can also avail nearly 80 lakh to 1.50 Cr rupees (Nationalised Banks).

Benefits of Education Loans

Valid for one and all: Any student who wants to study abroad can apply for a study loan. Even the students from economically backward sections of the society can take overseas education loans under the sponsored subsidy scheme by Government such as ‘Central Scheme to provide Interest subsidy’ (CSIS).

Effective for all courses: Study loan can be availed to pursue courses like, graduation, post-graduation, diploma courses, vocational courses in foreign universities.

Can be availed without much an ado: Education Loan for Abroad Studies are broadly and effortlessly available. In fact, study loans are a priority product in all banks as per the RBI’s guidelines.

Wide range of loan amounts: Financial Institutes can offer loans anywhere between Rs.20 lakhs to Rs. 1.50 Cr. The size of the loan depends on the course applied for, University ranking and the duration of the course along with the parents’ financial credentials.

Low interest rate for female students: Usually female students are offered loans at lower interest rates.

Easy repayment: Also, another great advantage of study abroad loan is that the loan amount need not be repaid immediately. The student gets the advantage of Moratorium Period which is the sum of study period and job search period. The repayment tenure can extend up to 10 to 15 years after the completion of the course.

With the global economy facing instability in recent years, education loans provide security to international students whose personal funds might dry out due to unexpected crises. This article gives an insight on how the education loan is beneficial to study abroad aspirant. But to know about the entire process of education loan you can walk into any study abroad consultants and avail assistance for Overseas Education Loan process.

Documents Required for Education Loan

These days all the banks which are operating in India provide various type of loans to their account holders and public. Like Education Loan, Car Loan Two wheeler loan, used car loan, Home loan etc. There are various types of loan for which you can apply to any of the banks who are providing their services. Education loan are really great way for the students who are willing to continue with their higher education and they want a financial support. Banks provide students education loan and they support students to complete their studies and after their studies students can pay the amount back to the bank.

But when any student applies for Bank education loan or for loan from any of the other banks. They ask for various documents from the student who is applying for the credit from them. And if you are searching online for an article in which you will find details or information regarding the documents required for Bank education loans. Then you have been landed on the right website, because in this guide on Online Indians you will find all those documents which you need to submit to Bank if you want to apply for loan.

What is Education Loan?

But before that I would like to tell you what actually it is? so here is a brief explanation about it. Education loan is a type of loan designed to help students pay for post-secondary education and the associated fees, such as tuition, books and supplies, and living expenses. It may differ from other types of loans in that the interest rate may be substantially lower and the repayment schedule may be deferred while the student is still in school. It also differs in many countries in the strict laws regulating renegotiating and bankruptcy.

So here is the list of documents required for Bank education loan if you are applying for it. I hope this article will be informative and helpful for you.

Completed loan application form: The first thing is you need to collect the loan application form from any of the branches of Bank or you can get it online as well on their official website. Collect the form and fill all the details which is asked in the form and complete it.

Documents for proof of age: You need to submit document to the bank which will certify your age. You can submit your birth certificate. But make sure you have signed on your photocopy of Birth certificate to make it self attested. Because without your signature it will not be considered as valid proof.

ID Proof documents: For Identity Proof you can submit following documents,

  • Aadhaar Card.
  • Passport.
  • PAN Card.
  • Voter ID Card.
  • Certificate of address having Photo issued by MP/MLA/Group-A Gazetted Officer in letter head.
  • Certificate of address with photo from  Govt. recognized Educational Institutions.
  • Ration Card.
  • Driving License.
  • Arms License.
  • Certificate of photo identity issued by Village Panchayat  head.
  • Current  passbook of Post Office or any scheduled Bank with your Photo on it.

Address Proof Documents: For address proof documents you can submit the following documents,

  • Voter ID Card.
  • Certificate of address having Photo issued by MP/MLA/Group-A Gazette Officer in letter head.
  • Certificate of address with photo from  Govt. recognized Educational Institutions.
  • Aadhaar Card.
  • Ration Card.
  • Notarized Sale or lease Agreement.
  • Current  passbook of Post Office or any scheduled Bank with your Photo on it.

Photographs: You need to submit passport sized photographs of applicant to the bank.

Marks sheet: You have to submit photocopies of  marks sheet of your highest qualification to the bank.

Proof of Income of Parents or Guardians: ITR of parents or guardians of the loan applicant.

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